Risk Management

Evercore: If Markets Drop More, Don't Expect To Be Bailed Out By The Fed This Time

"With the US equity market sell-off intensifying Wednesday afternoon, a number of clients have asked at what point the Fed would ride to the rescue. Our answer is that this time the cavalry is not coming — at least not unless we see something much larger — at least a 5 - 10 per cent type correction and maybe not immediately even then."

Moodys Slashes Ratings On 6 Canadian Banks, Fears Asset-Quality Deterioration, Soaring Household Debt

Amid Poloz-described "unsustainable prices" in various cities, and just days after the collapse of Canadian mortgage lender Home Capital Group and our discussion of the dire state of Canadian savers (and their record household debt), Moodys has cut the rating son six of Canada's largest banks because of "ongoing concerns that expanding levels of private-sector debt could weaken asset quality in the future."

Key Events In The Coming Week: Inflation, Spending In The Spotlight

With the French election now finally in the rearview mirror, this week's focus is on global inflation releases, with the spotlight falling on the US and China. We also have BoE and RBNZ rates meetings. In other data we note industrial production in the Eurozone, UK and Norway along with US retail sales and Fed speakers.

Oil Fireworks Unsettle Global Markets Ahead Of Payrolls Report

With all eyes on crude, following last night's mini flash crash which sent WTI lower by 3% from just above $45 to under $43 in under 10 minutes, equity markets, generally quiet overnight, have taken on a secondary importance ahead of today's key risk event, the April payrolls report. In global equities, Asian and European stocks are lower, while S&P futures are little changed.

"Someone Is Blowing Up": RBC Warns China-Induced Unwinds Are Escalating

"Something is off the past few weeks...  somebody’s ‘mean-reversion’ strategy (likely a stat arb / quant fund) has triggered ‘stop outs’ as the underlying commodities space now ‘catches down’ to the behavior already exhibited across the energy equities space throughout the course of 2017."

Sell In May – Myth Or Reality?

A willful disregard of “risk” will inherently lead to the destruction of the two most precious and finite assets that all investors possess – capital and time. Just something to consider when the media tells you to ignore history and suggests “this time may be different.” That is usually just about the time when it isn’t.

Playing The Game To Win - "I Made My Money By Selling Too Soon"

"There is no doubt that the market can grind higher to more dizzying valuations. However, there is also strong historical evidence that this market will normalize to average valuations. In the wisdom of Bernard Baruch, there are times when you “make your money” by not losing it. Perhaps more importantly, you preserve the ability to buy when better opportunities present themselves. "

Oil Slides After Saudis Unexpectedly Cast Doubt On Production Cut Extension

One week after "unnamed sources" reported that Saudi Arabia had backed the proposed 6 month extension to oil production cuts, this morning oil is lower after the world's biggest oil producer appeared to backtrack on its trial balloon from last week, when Saudi Arabia’s energy minister said it is "too early" to decide whether OPEC will extend its crude-production-cutting agreement for the rest of the year.

How To Trade The Trump-Xi Summit

The summit between Donald Trump and Xi Jinping is arguably the most-anticipated meeting of the U.S. leader’s presidency so far. How will financial markets react to the tete-a-tete in Florida? Several trades and analysts share their views.

Investors' Leverage Hits An All-Time High

"...on a quarterly basis, the market is currently more overbought than at just about any other point in history... Combined with record levels of margin debt, the current conditions HAVE NEVER lasted indefinitely. "