Jordan Rochester

FX LEHMAN MANUAL. Another chance to get this. It doesn't matter how experienced you are as a trader I really recommend you read this. Just for the Forwards calculation alone (which changed my game) I recommend all traders go through the whole manual. Back pre GFC some say Lehman was THE other Alpha bank (GS being the rival) I never worked there BUT I have mentored ex-traders who did. They are the finest traders I have ever met. Take outs for me: 1. The FWDS formula to work out a quick and dirty spot price based on rates today. 2. Crosses - say no more but if you want to know how I look at crosses DM me. 3. Swaps and Options - a nice brief outline of these. Please LIKE and make a comment for a PDF Copy. You can also join our institutional insights list The Adamis Gold to never miss out on all the future Manuals and interviews with FX legends. Click in the comments as the link is there too.

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6 𝐭𝐡𝐨𝐮𝐠𝐡𝐭𝐬 𝐨𝐧 𝐯𝐨𝐥𝐚𝐭𝐢𝐥𝐢𝐭𝐲 𝐚𝐧𝐝 𝐫𝐢𝐬𝐤 𝐢𝐧 𝐩𝐫𝐢𝐯𝐚𝐭𝐞 𝐚𝐬𝐬𝐞𝐭𝐬: 1️⃣ Many (not all) PA are valued infrequently and with a lag. This smooths valuations and dampens volatility. Some people like this. This is ok. Just don't automatically assume low vol = low risk 2️⃣ It's more likely for some PA to be properly revalued annually (e.g. real estate) than more frequently. A simple way to overcome the valuation problem is to shift from: - calculating vol of quarterly returns (which are smoothed) - to vol of annual returns (which are more likely to capture revaluations, even if lagged response) 3️⃣ Can also attempt to "add back" some of the vol by using statistical de-smoothing techniques. But can be v.sensitive to the data so interpret with care 4️⃣ Can lean on public market proxies e.g. BB-corp bonds or lev loans for junior infrastructure debt. But also need to appreciate the differences. e.g. infra debt issuers generate more stable cashflows and the debt benefits from backing by a hard asset with long economic life 5️⃣ There are legit reasons why some PA can argue for being lower risk than public mkts (see pic) e.g. superior access to info, asset-backing, cashflow stability, covenants. There are also valid arguments which push in the opposite direction e.g. leverage, more concentrated funds, illiquidity, perf dispersion between funds. These qualitative factors matter 𝐀 𝐜𝐨𝐧𝐭𝐞𝐧𝐭𝐢𝐨𝐮𝐬 𝐛𝐞𝐥𝐢𝐞𝐟 𝐨𝐟 𝐦𝐢𝐧𝐞: Some price movement in public markets is driven by investor fear/greed rather than fundamentals. The behavioural temptation to sell when markets are falling is in itself a contributor to vol The fact that PA investors are often unable to sell their stakes in such an environment prevents them from making the same behavioural mistakes, insulating PA from these sentiment shocks Even plays to their advantage as allows PA investment managers to act in counter-cyclical way Arguably these short-term shifts in sentiment are irrelevant to long-term investors. The fact that they are glossed over in PA vol should not necessarily be misinterpreted as an oversight or “wrong” ▶️So what? Need to look beyond numbers and take account of qualitative factors. Real estate risk is nearer to equities than bonds, despite what vol analysis might suggest. PE is highly diverse. Higher leverage in large cap buyouts means that it would be reasonable to treat the sector as riskier than public equities, but a qualitative case can be made for small/mid buyouts to treated more favourably. Individual VC investments = v.risky, but portfolios have been remarkably resilient 𝐖𝐡𝐚𝐭 𝐝𝐨 𝐲𝐨𝐮 𝐭𝐡𝐢𝐧𝐤? (note: this is summary of the vol/risk section from my recent paper on PA which I'll add a link to in the comments) 𝐋𝐢𝐤𝐞 𝐜𝐨𝐨𝐥 𝐜𝐡𝐚𝐫𝐭𝐬 𝐚𝐧𝐝 𝐢𝐧𝐬𝐢𝐠𝐡𝐭𝐬 𝐨𝐧 𝐦𝐚𝐫𝐤𝐞𝐭𝐬? Follow me 👋 And click the 🔔 at top of my profile to be notified when I post #privateassets #privateequity #schroderscapital

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Positive signs across the Investment Markets ● Goldman Sachs is increasing Credit Lines for Private Equity firms, as deal making grows ● The ADGM is reporting a surge in AUM, and an influx of international managers ● The DIFC saw over 5,000 new jobs created in 2023, with numbers continuing to grow in Q1 (in an area of just 110 acres) ● We're seeing existing clients in the region increase the volume of Institutional Sales & Investment roles, and we're receiving record numbers of inbound investment clients looking to hire ● Sovereigns are reaching new AUM records, and we're seeing several new Sovereign subsidiaries and cross-country Sovereign JVs ● Older news, but the UAE has been removed from the FATF grey list, potentially increasing investor confidence in the region ● Hedge Funds continue to relocate senior traders and PMs to the region

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In our latest article, we delve into the concept of open interest in options trading: https://lnkd.in/ebSxsf3 ✨ Join us as we demonstrate how Python can be used for analysing and interpreting open interest data, providing traders with valuable insights and tools to enhance their decision-making process.✔️ #openinterest #data #python #trading

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In August, ICE traded the first exchange-listed ESTR option. ESTR futures have been available for trading for some time with ICE, CME, and EUREX, all competing to be the leading player. Futures trading volumes in ESTR have increased since the start of 2024, with record months reported in July and August, and September appears poised to extend this trend. ESTR futures now account for approximately 14% of all short-term EUR trading*. However, despite this rise in activity, EURIBOR remains the dominant benchmark for quoting OTC EUR options. "The initiation of options trading could signify a significant step towards greater liquidity in the OTC ESTR options market." Ian Sams, Head of Product – EMEA. TraditionData offers a well-established EURIBOR-based Swaptions and Cap/Floor surface, along with an ESTR equivalent since 2021. Both products deliver comprehensive coverage of at-the-money and out-of-the-money pricing, spanning over 20,000 price points. 💻 https://lnkd.in/d3dcatVX 🌎 ESTR: https://lnkd.in/ehJDmWu4 🌎 EURIBOR: https://lnkd.in/dMmDeRZK 📧 [email protected] #ESTR #EURIBOR #InterestRates #MarketData #TraditionData #Swaptions *source Clarusft.com

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UK #inflation figures for Apr 2024 show inflation edging closer to target but still running a bit hotter than expected. The consumer price index (CPI) rose by 2.3% on last April. In March, it was running at 3.2%, but analysts had estimated that it would slow to 2.1%. Meanwhile core CPI (removing all the volatile stuff) is at 3.9% - down from 4.2% the previous month, but again. higher than the expected 3.6%. That said, one interesting snippet is that inflation as measured using the old pre-2003 target - RPIX (retail price index excluding mortgage interest payments) - is now actually back below target (running at 2.3% vs the old 2.5% target). Note that RPIX usually comes in higher than CPI, hence the higher target back then. Overall - we've now had two bits of key data (wage and price inflation) that have overshot a bit. All else being equal, they make the case for a June rate cut a little weaker. But we've still got May's data for both wages and prices to come before the next Bank of England meeting.

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𝗛𝗮𝘃𝗲 𝗯𝗼𝗻𝗱-𝗵𝗲𝗮𝘃𝘆 𝗺𝗶𝘅𝗲𝗱 𝗮𝘀𝘀𝗲𝘁 𝗼𝘂𝘁𝗳𝗹𝗼𝘄𝘀 𝗯𝗼𝘁𝘁𝗼𝗺𝗲𝗱 𝗼𝘂𝘁? The exodus from Mixed Asset GBP Conservative. Balanced—and to a lesser degree, Flexible—funds has been significant. Between Q2 2022 and Q2 2024, these classifications have suffered a combined £21.1bn, with GBP Balanced funds bearing the brunt of this, with £14.73bn of redemptions. Over the same period, MA GBP Aggressive funds have taken in £3.33bn. So, what’s been happening? Our best guess (and apologies to regular readers, if such exist, as I’ve said this many times), is that investors had been using MA funds as bond surrogates during the ultra-low-rate environment following the global financial crisis. When inflation kicked in in 2022, and decent yields could be had in pure fixed income plays, this trend reversed, and bond flows increased commensurately. That also helps explain why Aggressive flows stayed in the black, as these are too equity-heavy to be passed off as fixed income substitutes. The chart below shows this reached its nadir in Q4 2023. Has this trade been rinsed out? We’ll get a better idea when Q3 data comes out, so patience, please. But August data suggests we’re not quite there yet. While MA GBP Flexible took a respectable £126m and Conservative £16m, Balanced suffered the fourth-worst outflows, at £312m. Arguably, then, more pain to come. See Lipper’s UK fund flows report, Everything Flows, out next Tuesday for more details on where the money is going. Detlef Glow, Adam Vaites, Al McMutrie (He/His/Him) 𝗨𝗞 𝗠𝗶𝘅𝗲𝗱 𝗔𝘀𝘀𝗲𝘁 𝗳𝗹𝗼𝘄𝘀, 𝗤𝟯 𝟮𝟬𝟭𝟵 𝘁𝗼 𝗤𝟮 𝟮𝟬𝟮𝟰

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Trump's "An eye for an eye, a tariff for a tariff" is like a double-edged sword My 2018 prognosis on persistent protectionism was that it would last another five years before global equilibrium was attained. (https://shorturl.at/5scS2) It's been six and a half years since. Following a brief interregnum, the reelection of Donald Trump exemplifies that the disenchantment of the West with globalization has intensified, foreboding a global reset. Trump ver 2.0 comes with a reinforced version of mercantilism and a promise of delivering the Gilded Age. But is his machination anachronistic? What does it mean for the Global South and what does it all mean for the markets? We discuss these in this piece. published here: https://lnkd.in/dCpaQ-Fa

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The latest Schroders Equity Lens chart pack is out now. Normally I only post my top charts from it but this time I'm seeing if you find like the whole thing useful? If you like it, like and repost the post so I know! It's packed full of charts on valuations, earnings, market structure, small caps vs large, growth vs value, and more. Let me know what you think in the comments Is there anything else you'd like to see in here? You can sign up to receive all of our content on the preference centre on our website. Send me a message if you'd like to know how #equities #investingstrategy #markets #stocks ********************* 👋 Follow me for chart-driven investment insights and the #FridayChartQuiz 📈📊📉

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Interesting point in here on the importance of share buybacks to US equity markets - which implies it's good news that they're increasing fast here in the UK and across the rest of the world too

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𝗘𝗧𝗙 𝗶𝗻𝘃𝗲𝘀𝘁𝗼𝗿𝘀’ 𝗼𝗻-𝗼𝗳𝗳 𝗹𝗼𝘃𝗲 𝗮𝗳𝗳𝗮𝗶𝗿 𝘄𝗶𝘁𝗵 𝘁𝗵𝗲 𝗠𝗮𝗴𝗻𝗶𝗳𝗶𝗰𝗲𝗻𝘁 𝗦𝗲𝘃𝗲𝗻 Last month, I noted that #ETF investors in the UK had shifted their US bets away from mega caps. In October, £2.52bn of £5bn, or 50.4%, invested in Equity US on the LSE has gone to equal-weighted ETFs. That was not just unusual, it seems to have been unprecedented. Was this the start of a trend? It seems not (or, at least, not yet), and investors in US equities have largely resumed their edgy affair with S&P 500 mega-caps. In October, only 19.25% of the £5.5bn of assets going to S&P 500 ETFs went to equal-weighted products (see chart). Like any edgy affair, it may well end badly – but, as someone once said, while the music is playing, you have to keep dancing. I’ll be using Lipper data to take a deeper look into the increased concentration in US and global equity indices over the next couple of weeks. Katya Nelyudova, Rebecca Chesworth Jamie Gordon, Richard Philbin 𝗘𝗾𝘂𝗶𝘁𝘆 𝗨𝗦 𝗖𝗮𝗽- 𝘃 𝗘𝗾𝘂𝗮𝗹 𝗪𝗲𝗶𝗴𝗵𝘁𝗲𝗱 𝗟𝗦𝗘-𝗹𝗶𝘀𝘁𝗲𝗱 𝗺𝗼𝗻𝘁𝗵𝗹𝘆 𝗳𝗹𝗼𝘄𝘀 (£𝗯𝗻)

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#TODAY via Bloomberg #Ukraine’s GDP warrants rallied to the highest since early 2022 after the government promised to make some of its debt payments. The warrants, a kind of debt security with payouts linked to economic growth, rose by about 9 cents this week to trade at 58 cents on the dollar on Tuesday, the highest level since Russia started its full-scale invasion of Ukraine. The notes have rallied alongside Ukraine’s other debt after the government reached a preliminary agreement with some of its private creditors to restructure more than $20 billion of international bonds, a move that will help the country finance its defense efforts. When announcing the deal, the government also said it intended to restructure $2.6 billion in outstanding warrants and make some payments on them. Read full story here 👇🏽🇺🇦 https://lnkd.in/eB8fSyei

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Technical Analysis - Does it Actually Work? Many traders remain skeptical of technical analysis (TA). However, there are some TA frameworks, such as the "Relative Strength Index" (#RSI), that appear to add informational value. The attached chart shows the distribution of S&P 500 3-month returns over the past 10 years, both: 1) Outright 2) Conditioned on an elevated starting RSI (70+) As you can see, an elevated starting RSI appears to result in a "fatter left tail" for future equity returns. Some food for thought. Feel free to reach out with specific questions! (posts ≠ advice) | (reposts ≠ endorsements)

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