Behavioural Finance Markets
Yesterday the UK Prime Minister Theresa May gave a speech at Lancaster House which outlined potential objectives for the country’s Brexit negotiations. In it, she presented a Brexit plan that suggested a more meaningful break with the European Union than many of the possible options.
So why did Sterling strengthen… Read the article
Behavioural Finance Markets
I wrote twice last year on how 2016 could mark a pivotal moment for investors: both in terms of the market treatment of risk, and in the macro and policy-making regime.
This certainly proved to be the case in calendar year 2016. The pro-bond and ‘safety… Read the article
Investment Industry Markets
There were a couple of pieces written in the media in 2016 suggesting that the year represented a tipping point in the shift from active to passive management, both in equities and fixed income markets. Whether or not this is true, when it comes… Read the article
Some surprises feel more surprising than others. When events have binary outcomes, like an election result, you can instantly and clearly compare what you believed beforehand to what actually happened. These are “shocks.”
When something changes over time on the other hand, like the oil price, the growth of an… Read the article
Markets remain obsessed with relatively minor changes in US official interest rates expectations. The FOMC revealed that at least three interest rate increases next year look reasonable, slightly higher than prior forecasts of two. No one should be surprised. Given the starting point levels of interest rates, the relative insensitivity… Read the article
Behavioural Finance Investment Industry Markets
Could it be that professional investors are chasing year end equity returns to flatter calendar year performance? And does this set us up for a weaker January as those same investors unwind positions they might not really believe in?
As equity markets have continued to rally there has been a… Read the article
Behavioural Finance Economics Markets
There have been many suggestions that the sell-off in government bonds in the US was overdone. The argument was that weakness was a result of Trump’s victory, but that it is far too early to know what Trump will do or the effect it will have. We have some sympathy… Read the article
It seems apposite that Matteo Renzi’s term as Italian Prime minister should end in this way. For investors, this referendum was a surreal distraction. The population were voting on the nuance of domestic decision making, but Eurozone membership means that there is limited scope for those decisions to impact the… Read the article
Stop me if you’ve heard this one before: “Suppose that if you invest £70,000, I’ll offer you a bet on a coin toss. If it comes up heads, you win £14,000 pounds, if tails you lose £7,000.” Should you take the bet?
Early in 2016, the Bank of Japan (BoJ)… Read the article