prev
PREMIUM INSIGHT

Van Sciver: My Favorite Short Right Now Is…

Van Sciver: My Favorite Short Right Now Is… - HETV TMS DE 9.26.2016

In this brief excerpt from The Macro Show, Hedgeye Industrials analyst Jay Van Sciver responds to a subscriber’s question about his favorite short in the sector.


This Indicator Hits Level Not Seen Since Recession

The TED spread has our attention. With the market pricing in a drastic sudden increase in counterparty risk, the TED rose by 6 bps two weeks ago and by another 11 bps last week to 69, surpassing the 2011 spike and moving to levels we haven't seen since May 2009. 

 

This Indicator Hits Level Not Seen Since Recession - ted spread 9 26

 

Editor's Note: This is a brief excerpt from a research note written by Hedgeye Financials analyst Josh Steiner. To learn more about our institutional research ping sales@hedgeye.com.


Poll of the Day: Who Will Lose Tonight's Presidential Debate?

Takeaway: What do you think? Cast your vote. Let us know.


investing ideas

Risk Managed Long Term Investing for Pros

Hedgeye CEO Keith McCullough handpicks the “best of the best” long and short ideas delivered to him by our team of over 30 research analysts across myriad sectors.

Why We're Sticking With Low-Beta

Takeaway: Low-beta continues to beat high-beta. We're sticking with the call.

Editor's Note: This is a complimentary excerpt from today's Early LookClick here to subscribe for $1 a day.

 

Why We're Sticking With Low-Beta - Growth cartoon 06.03.2015

 

WHILE IT MAY SEEM LIKE EVERYONE ON OLD WALL TV NAILS IT

 

...in Dow Bro terms every time the Fed is forced to pivot back to dovish on #GrowthSlowing data, your returns have been higher being longer of Long-term Bonds, Utilities, REITS, and Gold.

 

That’s right. Both the absolute and relative returns are higher, but so are the risk adjusted (volatility adjusted) payouts. Not to be mistaken for “bad (data) = good” weeks,  on days (like today) when bad = bad, Down Rates, Down SP500 happens.

 

Another way to express a lower-volatility, higher return portfolio in 2016 has been buying low beta, safe-yielding, stocks. If you look at the mean performance of the top quintile vs. bottom quintile of SP500 companies, here’s that story:

 

  1. Low-Beta Stocks were up +2.3% last week to +11.8% YTD
  2. High-Beta Stocks were up +0.8% last week to +6.2% YTD

 

Again. You get it. Everyone was a winner last week, but being long High-Beta lost to those of us who are long Low-Beta. This is called making a conscious portfolio bet that #GrowthSlowing will pay-out Low-Beta, as an investing Style Factor, over the sexier stuff.


All Good? Global Defaults Up +61%

Takeaway: Risk continues to rise around the world.

Looking at a global defaults tally from S&P, there were 5 new defaults last week. That brings the global tally to

 

(Drumroll please)

127 Year to date

 

That's up +61% Y/Y. The sustained weakness in the energy patch isn’t only hurting energy companies – Investors who sank money into a rebound are also under water.

 

A very active PE fund in Texas is now asking investors to fork over hundreds of millions of dollars to bolster the troubled funds ... or risk losing the billions they have already invested.

 

All Good? Global Defaults Up +61% - default

 

Editor's Note: The snippet above is from a note written by our Macro team and sent to subscribers this morning. Click here to learn more.


CHART OF THE DAY: Fed Fade

Editor's Note: Below is a brief excerpt and chart from today's Early Look written by Hedgeye CEO Keith McCullough. Click here to learn more.

 

"... There was literally no other call to make heading into last week’s FOMC interest rate decision, other than that Janet Yellen’s Fed would fade. The US Dollar went down on that – rates did too. Stocks, Bonds, Commodities ripped.

 

Why? On a short-term basis here are some current 30-day inverse correlations vs. the US Dollar Index:

  1. SP500 -0.44
  2. Oil -0.70
  3. CRB Index -0.73
  4. Gold -0.74"

CHART OF THE DAY: Fed Fade - 09.26.16 EL Chart


next