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I'm not too worried about this situation in Greece. 1) The IMF might give in on their call for more austerity, thats good for Greece. The got economic green shoots now and austerity would kill it (because there is no central bank easing policy to counter it) 2) If the IMF holds firm and walks...

"Countries outside the eurozone cannot rely on such assurances. Once IMF disbursements end, they are on their own. In those cases, the fund is right to insist that debt sustainability is assured early. But in Greece, the ESM will hold two-thirds of Greek debt for at least another 30 years. As a...

They are still a decent value, only situation I can see them being haircut is if a leftist wins the presidential election in 2018 and then he goes into a FX reserve spending rampage. He would need support from congress as the law only allows the FX reserve to be used to pay down domestic BRL...

I just sold part of my BR USD bonds, about 4.4% of my assets(I got about 7.5% there now). I was able to sell them for a 4.5% yield, roughly a 200bps spread over US Treasuries. At that point, they are getting a little rich. But more importantly, this bond has turned quite illiquid, when the...

I guess the US markets are too liquid for that Trump dip to play out on a schedule like that. People hedged, sold, adjusted portfolios ahead of time and no big adjustment was needed when he actually took office. Even though he did some 'crazy' moves, it was all expected by the markets. While he...

Stockcharts messed up the chart for external uses. I took a screenshot for the actual chart that I was talking about

Another way to measure this is to look at the 13 period Average True Range (ATR) at 1.403, the 13 period ATR is on the low end of its multi-month range

So far my thesis that Trump was going to increase volatility in his first 30 days in office has been completely wrong. He is acting in that way I thought he would but the market is not caring (only the NY Times is caring). I run on vol tests (standard deviation of daily % changes) since...

Lots of FCMs will let you hold US Treasuries and trade futures using them as collateral

OAK continues to progress well http://ir.oaktreecapital.com/phoenix.zhtml?c=212597&p=irol-news&nyo=0

What is more amazing about this is that the author of the paper shows quite clearly that Eugene Fama made a serious error when he talked about a 'diversification return' in his paper. So the guy who wants to convince the world that markets are efficient shows that he doesn't understand the basic...

One situation where it might seem that diversification is adding to returns is when someone neglected an asset class and ends up investing in it. Say someone is 100% in US equities, if he puts 75% in US equities and 25% in EM equities, usually there will be an increase in returns (Since EM...

I wouldn't call it a rebuttal at all. You essentially agreed with the main points of the paper. The paper basically says: diversification decreases volatility but does not add dollars to the investor. It reduces risk but does not add to expected returns The problem is that you changed the...

People avoid emerging markets because 'they are risky' but all the data that I have seen shows that developed markets have a much bigger asset valuation than EMs, in stocks, bond and real estate. For stocks, bigger valuations come with a higher % chance of a significant drop in price. Meb Faber...

OP, With $2M and a balanced portfolio that has both developed and emerging markets in it, one can probably make 6-7% a year without too much difficulty (EM bonds in local currency alone yield 5%+ plus currency appreciation, which in most years will be 1-3%). All that while staying very...

US investors have to plan and prepare for a similar scenario in the next 10-20 years. Politicians in the US congress have made it clear by their actions that they won't move a finger to deal with the US fiscal issue until there is a crisis. When the crisis happens, US bonds, stocks and the USD...

Another finding from the UK data: UK investors had a staggering drawdown in the 70's. Stocks were down -68% real during the 73/74 downturn. Not only there was the oil price shock, the US recession but the UK had their fiscal crisis starting. Gilts were also falling off a cliff at the time (-42%...

Buffett is willing to lose 50-90% of his money by being in stocks 100%, in fact, more than that as he is not shy about leveraging his portfolio ~1.2-1.4 times to one. That's great. The question that I have is, what is the Sortino/Sharpe ratio of that compared to a 'balanced' portfolio that uses...

I just bought more GLD, GDX and GDXJ, about 3% in the GLD and 1% in the miners with more in the GDXJ (its more volatile so I get some 'natural' levarage there). I got many reasons for it but this UK data just sealed for me. Here are some quick points: -A government bond 'fair' valued is said to...

If I build a optimal (historically) UK portfolio of 60% stocks and 40% gold and then remove 30 pct points of gold to put in UK gilts or bills to see how they compare to gold as hedge, the drop in performance is noticeable The Sortino drops off a cliff, the Sharpe drop is more controlled but...