Podcast by Joe Weisenthal & Tracy Alloway, Odd Lots

Odd Lots

Podcast by Joe Weisenthal & Tracy Alloway

Bloomberg's Joe Weisenthal and Tracy Alloway explore the most interesting topics in finance, markets and economics. Join the conversation every Monday and Thursday.

Cross Asset Strategy

<ul><li>The hosts discuss the anniversary of an event called Volmageddon, which happened in February 2018. It was one of their first important episodes where they talked about the blow-up of short volatility.</li><li>They mention the popularity of shorting volatility as a strategy post-2008 financial crisis and its recent resurgence despite potential market risks.</li><li>The hosts express their interest in understanding why short vol is back and popular at this moment and its implications for the wider market. They introduce their guest, Chris Sidial, the co CIO of Ambrose group, who will provide insights on the topic.</li></ul><p><em>This podcast is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only.</em></p>

The hosts discuss the anniversary of an event called Volmageddon, which happened in February 2018. It was one of their first important episodes where they talked about the blow-up of short volatility.They mention the popularity of shorting volatility as a strategy post-2008 financial crisis and its recent resurgence despite potential market risks.The hosts express their interest in understanding why short vol is back and popular at this moment and its implications for the wider market. They introduce their guest, Chris Sidial, the co CIO of Ambrose group, who will provide insights on the topic.This podcast is sourced from an online content aggregator through publicly available sources and is displayed below for general informational purposes only.

Why the Short Volatility Trade Is Back and Bigger Than Ever

Head of Research and Global Chief Strategist, Steno Research

Andreas Steno

Head of Research and Global Chief Strategist

Macro and Geopolitical Research House

Steno Research

Steno Research is a new macro and geopolitical research house. We are based out of Copenhagen, Denmark, but have an international team and a strong network of sources and partners around the world. The team is lead by Andreas Steno, previous global head of strategy at Nordea Bank, and Mikkel Rosenvold, former chief consultant in the Danish Ministry of Finance.

<ul><li>Markets are pricing in heavy cuts for next year as inflation keeps coming in soft, making a soft landing the base case for the bulls, but everything comes at a price.</li><li>But how are assets likely to perform if the market narrative is correct and yields will indeed come down in a continued bull-steepening fashion, which in our view is the most likely scenario in H1 2024?</li><li>We have pulled out some of our cross-asset beta studies from our data-library to provide you with an overview of how assets perform during various yield curve regimes.</li></ul>

Markets are pricing in heavy cuts for next year as inflation keeps coming in soft, making a soft landing the base case for the bulls, but everything comes at a price.But how are assets likely to perform if the market narrative is correct and yields will indeed come down in a continued bull-steepening fashion, which in our view is the most likely scenario in H1 2024?We have pulled out some of our cross-asset beta studies from our data-library to provide you with an overview of how assets perform during various yield curve regimes.

Bull Steepening Watch – Is Lower Yields Really What Risk Assets Want?

Global Multi-Asset Investment Strategist, True Insights

Jeroen Blokland

Global Multi-Asset Investment Strategist

Build Well-Diversified Multi-Asset Portfolios

True Insights

Our research helps investors build well-diversified multi-asset portfolios and profit from market developments. In addition, our unique and proven Macro – Sentiment – Valuation (MSV) investment framework ensures a consistent flow of new investment opportunities. Together with our market views, these opportunities will be reflected in our live ETF-based Global Multi-Asset Portfolios.

<ul>
<li>Volatility Has dropped off a cliff, signaling that investors are unable to see any risk currently. That feels at least a bit complacent. </li>
<li>We take a deep dive to determine which asset class will likely benefit most from the first Fed rate cut and the start of the easing cycle. Spoiler alert! It’s not Equities.</li>
<li>OPEC’s resilience to continue production cuts is being tested. At the same time, our Fear &amp; Frenzy Sentiment Index has moved even further into FRENZY territory.</li>
</ul>


Volatility Has dropped off a cliff, signaling that investors are unable to see any risk currently. That feels at least a bit complacent. 
We take a deep dive to determine which asset class will likely benefit most from the first Fed rate cut and the start of the easing cycle. Spoiler alert! It’s not Equities.
OPEC’s resilience to continue production cuts is being tested. At the same time, our Fear &amp; Frenzy Sentiment Index has moved even further into FRENZY territory.


The Weekly Market Monitor – VIX Hits Multi-Year Low, Investors Can’t See Any Risks!

<ul>
<li>Fed Chairman Powell unintentionally re-emerged as a central bank dove. Yet, the poor ISM Manufacturing Index reading paints an entirely different picture, signaling 17%(!) downside.</li>
<li>Apart from the fact that US Small Caps cannot rely on Big Tech Companies to send prices higher, there is another compelling reason why they have been underperforming - debt.</li>
<li>Earnings season: Negative price reactions meet mixed surprises. This is especially true in the US, where valuation looks demanding. Interestingly, price-earnings action in China may signal a bottom is in.</li>
</ul>


Fed Chairman Powell unintentionally re-emerged as a central bank dove. Yet, the poor ISM Manufacturing Index reading paints an entirely different picture, signaling 17%(!) downside.
Apart from the fact that US Small Caps cannot rely on Big Tech Companies to send prices higher, there is another compelling reason why they have been underperforming - debt.
Earnings season: Negative price reactions meet mixed surprises. This is especially true in the US, where valuation looks demanding. Interestingly, price-earnings action in China may signal a bottom is in.


The Weekly Market Monitor – Did Powell Kill the Bear?

<ul>
<li>This week, the approval of a spot Bitcoin ETF took another leap forward. And a poll among investors reveals that this will be a game-changer. </li>
<li>Equities tumbled again, and earnings are to blame. Google is down hard as the ‘Magnificent 7’ delivered mixed earnings, nowhere near good enough, given they are priced for perfection! </li>
<li>And that’s not all. The spike in real yields suggests a whopping decline of 25%(!) of the P/E ratio of the S&amp;P 500 Index.</li>
</ul>


This week, the approval of a spot Bitcoin ETF took another leap forward. And a poll among investors reveals that this will be a game-changer. 
Equities tumbled again, and earnings are to blame. Google is down hard as the ‘Magnificent 7’ delivered mixed earnings, nowhere near good enough, given they are priced for perfection! 
And that’s not all. The spike in real yields suggests a whopping decline of 25%(!) of the P/E ratio of the S&amp;P 500 Index.


The Weekly Market Monitor – Reality Check!

United States

The VIX Index is a financial benchmark designed to be an up-to-the-minute market estimate of the expected volatility of the S&P 500® Index, and is calculated by using the midpoint of real-time S&P 500 Index (SPX) option bid/ask quotes.

Chicago Board Options Exchange Volatility Index (VIX INDEX)

Chicago Board Options Exchange Volatility Index

Chicago Board Options Exchange Volatility Index (VIX INDEX)

Why the Short Volatility Trade Is Back and Bigger Than Ever

In this podcast episode, the speaker and Joe discuss the anniversary of Volmageddon, the popularity of shorting volatility, and why it has made a...

Odd Lots

Bull Steepening Watch – Is Lower Yields Really What Risk Assets Want?

Let’s run through each asset class to see where to put your eggs if a bull-steepening of the yield curve continues into 2024.

Steno Research

The Weekly Market Monitor – VIX Hits Multi-Year Low, Investors Can’t See Any Risks!

The VIX collapsed to the lowest since COVID, which makes investors look complacent, especially with our Fear & Frenzy Sentiment Index still in Frenzy.

Jeroen Blokland

The Weekly Market Monitor – Did Powell Kill the Bear?

Start your week in financial markets with last week’s biggest stories! The Weekly Market Monitor will take you through the biggest charts and events.

Jeroen Blokland

The Weekly Market Monitor – Reality Check!

When something is 'priced for perfection,' disappointment is inevitable. Just ask Google. By the way, a spot Bitcoin ETF is inevitable, too. This...

Jeroen Blokland