Global Macro Trading Journal

everybody who think about investing in HKD should consider the similarities and differences between Switzerland and Hong Kong (which happen to be economies of amazingly similar sizes).

it is not irrational to bet on SNB success in defending the 1.20 level while at the same time bet that HK Monetary Authority lets the HKD float (my currency positions). just a food for thought....

in any case with active risk management these trades can hardly lose...
 
Quote from dhpar:

everybody who think about investing in HKD should consider the similarities and differences between Switzerland and Hong Kong (which happen to be economies of amazingly similar sizes).

it is not irrational to bet on SNB success in defending the 1.20 level while at the same time bet that HK Monetary Authority lets the HKD float (my currency positions). just a food for thought....

in any case with active risk management these trades can hardly lose...
More...

Its all a matter of time. SNB is too early on the game to give up(Odds the bureaucrats will want to lose face and reverse policy is minimal). HKMA is too long on the game suffering the consequences to want to stand for that longer, even then I'm sure the status quo will rein for a while, maybe for a full year. But barring a recession at some point they will act. The good thing about the trade is that a devaluation seems to be out of the question
 
Just read the presentation. Good stuff.

Of course page 126 is the money page.

"The conventional wisdom is that central banks can defend the strong side of their currency without limit by simply printing an unlimited amount of money. ... The reality is different ..."

It's a small investment world out there. The key is knowing which ideas to wager on. After reading the presentation, I have no question Pershing got the idea from Grant. Sadly, the vols on the options were a lot lower when Grant published to far less fanfare. I remember making a few phone calls to see what kind of scratch was necessary to put on an option trade like that. It wasn't as much as I thought. In typical fashion, I got distracted by another another investment or a game of golf or something and let the idea slide.
 
Quote from Martinghoul:

I presume you boyz have seen Norman Chan's response to the various "de-pegging" suggestions?
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Are you 98% sure he is telling the truth?
 
I haven't seen Chan's response to Ackman. Here's what he said on Aug. 15 ...

As regards the suggestion of a link to the renminbi, I have repeatedly pointed out that the conditions for contemplating this option are not there because the renminbi is not yet freely convertible.

Does that mean a change is coming when the yuan becomes freely convertible? 2015?
 
Quote from ralph00:

I haven't seen Chan's response to Ackman. Here's what he said on Aug. 15 ...

As regards the suggestion of a link to the renminbi, I have repeatedly pointed out that the conditions for contemplating this option are not there because the renminbi is not yet freely convertible.

Does that mean a change is coming when the yuan becomes freely convertible? 2015?
More...


Donald Tsang openly mentions the possibility in the link already posted above :

http://www.alsosprachanalyst.com/economy/so-you-want-to-bet-on-hong-kong-dollar-appreciating.html
 
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