Dispersion and Correlation: Which is “Better?”

We recently introduced the concept of dispersion, which measures the average difference between the return of an index and the return of each of the index’s components.  In times of high dispersion, the gap between the best performers and the worst performers is relatively wide; when dispersion is low, the performance gap narrows.  Today’s dispersion Read more […]

A NICKEL For Your Thoughts?

Industrial Metals are historically the most economically sensitive sector besides energy. While Chinese oil demand growth is set at 3.6% in 2014 and HSBC’s Chinese Manufacturing Purchasing Managers’ Index (PMI) edged down to 50.8 in November, barely above the key 50-threshold delineating expansion from contraction, according to IEA’s OMR Report, nickel is the only commodity in petroleum and industrial Read more […]

Nat Gas Is HOTTEST In 4 Years

Every conversation I’ve had today with people from Nashville to Toronto has started with how cold it is outside.  After the shock of the cold and when the heating bills come due, the conversation may turn to how expensive heat was in January.  That, of course, is at least for those who don’t invest in Read more […]

Low Dispersion Implies Low Value Added

Understanding a market’s dispersion provides important insights into its internal dynamics and the opportunities and pitfalls that might await both active and passive investors.  Dispersion measures the average difference between the return of an index and the return of each of the index’s components.  In times of high dispersion, the gap between the best performers Read more […]

A Tough Day for the Dow

Friday, January 24 was a rough day for the US equity markets with the Dow Jones Industrial Average shedding 318.24 points or 1.96%.  Driven by increasingly wide spread expectations of a market correction and slowing manufacturing in China, the Dow experienced its worst single day point drop since June 20th of last year.  On that day, Read more […]

Munis – Once again a ‘risk off’ asset class

Municipal bonds yields have come down at a faster pace than U.S. Treasury bond yields helping to push up bond prices. Equity and currency market volatility is helping to drive cash inflows for municipal bond funds and when combined with manageable new issue supply has helped foster a stronger muni bond market. The S&P National AMT-Free Municipal Bond Index tracking Read more […]

Looking Back for Forward Guidance

Investors and some central bankers believe in forward guidance – that announcing what the bank will do well before it does anything can control the economy.  One proponent is Mark Carney the governor of the Bank of England (BOE) and previously head of the Bank of Canada. In a speech earlier today at Davos he Read more […]

Natural Gas Is Backwardated And The Weather Is Backwards

When I see a forecast of freezing weather, unlike most, I don’t think about how I will dress warmly or prepare for the cold.  As a commodity lady, I think about how much the price of natural gas will increase. However when I saw this on TV yesterday, I had more food for thought than Read more […]

Indian Fixed Income or Equities: Know your onions!

The fixed income market is quintessential for the growth of the economy. They serve as one of the mediums for the government to raise money. In India the fixed income market has been attaining the depth as well as maturity over the years and the government securities play a dominating role. The on-the-run 10 year Read more […]