Trading Blog

Treasuries, Bunds Sell Off: Steepener Trade Potential?

At the end of August, the US 10-year Treasury bond was yielding 1.43 percent. It is now back up to nearly 2 percent. For those who missed the first rally, this gives another opportunity. At least to those who believe in some version of the narrative of a reasonably high probability of a recession within […]

Lessons from Oil’s Largest Spike in 28 Years

All market watchers know the details by this point. Drone strikes on Saudi Arabia’s Abqaiq facilities sent crude oil prices flying 10 percent or more depending on the type of crude. Brent crude, shown above, is more susceptible to a Saudi outage than WTI. It was the largest daily gain in 28 years, back when […]

‘Risk On’ Is Back: Implications for Various Markets

“Risk on” is back in fashion. Over the previous week, the gold rally stalled at $1,550 per ounce and has since retreated to just below $1,500. Positioning-wise, gold became “stretched” with the negative news surrounding global trade and slowing economic output. When traders are heavily betting in a particular direction on aggregate, it adds risk. […]

‘Trilemma’: Currency Regimes Explained

In economics, a trilemma refers to a decision-making theory. A play on the word “dilemma”, in which case implying a trade-off running along a dual spectrum, a “trilemma” refers to a scenario in which there are three competing trade-offs. Often, the problem is conceptualized as needing to choose two of the three in order to […]

Currency Intervention: Can Trump Weaken the Dollar?

Experienced currencies traders know that government sponsored currency intervention is part of the game and can come out of the blue even when you may not expect it. Forex as a whole is a difficult asset class to trade with any degree of precision because there are so many factors that ultimately influence its behavior. It’s […]

Argentina’s Debt Restructuring

In a recent article, we took a look at the issues confronting the Argentinian economy. For those who trade emerging market currencies (“EM FX”), it’s important to understand the fundamentals of what makes a currency move and idiosyncrasies governing these currencies. Unlike when you’re trading a G-7 currency pair, you don’t regularly have to worry […]

Hiring Traders to Work for You: What You Need to Know

If you have a proprietary trading operation, multi-strategy hedge fund, family office, or other business designed to make money trading the financial markets, at some point you will probably want to hire traders to work for you (beyond the execution kind). It’s a way to scale and diversify your trading business. However, for anyone who’s […]

Will We Have a Recession Within 18 Months?

Due to the stream of recent events, there’s been discussion on whether a recession is likely in the US and other developed market economies within the next 1-2 years. For example, over the past few months, we’ve seen the following: 1. Various yield curve inversions in various developed market economies 2. Slowing growth 3. Tepid […]

Argentina’s Dilemma

Argentina has been in the global markets headlines for over a year, with its tribulations with its economy and the volatility and severe depreciation in the Argentina peso. It is, once again, quite likely to default on its debt within the next few years unless it receives significant help from external sources (i.e., the IMF) […]

How to (Tactfully) Bet Against the Consensus

The difficult thing about doing well in the markets is that it’s not whether results turn out “good” or “bad” for a particular asset or asset class but how things turn out relative to what’s already discounted in the price. The range of information that it unknown is going to be far greater than whatever […]

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