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.

Macroeconomics

<ul>
<li>Comparing real yields and P/E ratios shows little relationship between the two. However, this is because this is the wrong comparison and includes the issue of regime shifts.</li>
<li>Our analysis shows that equity market valuation is extremely vulnerable to spiking real yields.</li>
<li>Based on history, the S&amp;P 500 Index should become 25% cheaper as the colossal rise in real yield continues.</li>
</ul>


Comparing real yields and P/E ratios shows little relationship between the two. However, this is because this is the wrong comparison and includes the issue of regime shifts.
Our analysis shows that equity market valuation is extremely vulnerable to spiking real yields.
Based on history, the S&amp;P 500 Index should become 25% cheaper as the colossal rise in real yield continues.


Ready to Get Spooked? Properly Comparing Real Yields and P/E Ratios = Massive Downside for Equities!

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>
The world of Macro never fails at keeping us busy and this week I reveal the 10 charts that I currently monitor daily to keep myself up to speed on allocations amidst this turbulence. Enjoy (the ride)! It’s been evident for a while that the diversification effects from US Treasuries are weak and we are now approaching a record high correlation between Equity and Bond returns. 
</li>
<li>If you haven’t already altered your portfolio composition, it is already overdue as the 60/40 portfolio seems structurally challenged.</li>
</ul>



The world of Macro never fails at keeping us busy and this week I reveal the 10 charts that I currently monitor daily to keep myself up to speed on allocations amidst this turbulence. Enjoy (the ride)!   It’s been evident for a while that the diversification effects from US Treasuries are weak and we are now approaching a record high correlation between Equity and Bond returns. 

If you haven’t already altered your portfolio composition, it is already overdue as the 60/40 portfolio seems structurally challenged.


Steno Signals #70 – 10 Charts You NEED to Monitor in Global Macro

Head of Research, Steno Research

Emil Moller

Head of Research

<ul><li>Another week of blood and drama. But fear not, we’re here to wrap up the week with our usual watch series, where we’ll gauge the current market sentiment using the latest positioning data.</li><li>First things first, let’s take a quick peek at the chart of the week down below. In yesterday’s Portfolio Watch, we spilled the beans about some big changes we’re planning for our portfolio.</li><li>One of the main reasons we’re making these moves now is because of what we see in this chart: The S&amp;P 500 just dipped below its 200-day moving average support line, waving a red flag that suggests we might be in for a bumpy ride in the coming weeks</li></ul>

Another week of blood and drama. But fear not, we’re here to wrap up the week with our usual watch series, where we’ll gauge the current market sentiment using the latest positioning data.First things first, let’s take a quick peek at the chart of the week down below. In yesterday’s Portfolio Watch, we spilled the beans about some big changes we’re planning for our portfolio.One of the main reasons we’re making these moves now is because of what we see in this chart: The S&amp;P 500 just dipped below its 200-day moving average support line, waving a red flag that suggests we might be in for a bumpy ride in the coming weeks

Positioning Watch: Shifting Gears without Panic

<ul>
<li>Geopolitical risks are building, not only because of the developments in the Middle East. Semiconductor companies, including ASML and NVIDIA, got a clear warning this week that their growth ambitions in China are at risk. </li>
<li>Chinese property developers show ‘Crypto-like’ declines, and downside risks for Commodities appear.</li>
<li>Bond yields keep pushing higher, but our fair value estimate for the 10-year US Treasury yield points to a peak.</li>
</ul>


Geopolitical risks are building, not only because of the developments in the Middle East. Semiconductor companies, including ASML and NVIDIA, got a clear warning this week that their growth ambitions in China are at risk. 
Chinese property developers show ‘Crypto-like’ declines, and downside risks for Commodities appear.
Bond yields keep pushing higher, but our fair value estimate for the 10-year US Treasury yield points to a peak.


The Weekly Market Monitor – Where’s the Plunge Protection Team?

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/newcrest-mining-ltd" target="_blank" data-smartkarma-citation="entities:691:1" rel="noopener">Newcrest Mining (NCM AU)</a> shares stop trading after the close on 26 October and <a href="https://www.smartkarma.com/entities/newmont-mining-corp" target="_blank" data-smartkarma-citation="entities:14503:1" rel="noopener">Newmont Mining (NEM US)</a> CDIs will start trading from the open on 27 October.</li>
<li>
<a href="https://www.smartkarma.com/entities/newmont-mining-corp" target="_blank" data-smartkarma-citation="entities:14503:1" rel="noopener">Newmont Mining (NEM US)</a> CDIs should replace <a href="https://www.smartkarma.com/entities/newcrest-mining-ltd" target="_blank" data-smartkarma-citation="entities:691:1" rel="noopener">Newcrest Mining (NCM AU)</a> in the S&amp;P/ASX indices from 27 October. But there could be index changes at the subsequent rebalances.</li>
<li>Based on the case of <a href="https://www.smartkarma.com/entities/block-inc" target="_blank" data-smartkarma-citation="entities:35684:1" rel="noopener">Block (SQ2 AU)</a>, we could see <a href="https://www.smartkarma.com/entities/newmont-mining-corp" target="_blank" data-smartkarma-citation="entities:14503:1" rel="noopener">Newmont Mining (NEM US)</a> CDIs deleted from the ASX20 Index in December and from the ASX50 Index in March/June.</li>
</ul>



Newcrest Mining (NCM AU) shares stop trading after the close on 26 October and Newmont Mining (NEM US) CDIs will start trading from the open on 27 October.

Newmont Mining (NEM US) CDIs should replace Newcrest Mining (NCM AU) in the S&amp;P/ASX indices from 27 October. But there could be index changes at the subsequent rebalances.
Based on the case of Block (SQ2 AU), we could see Newmont Mining (NEM US) CDIs deleted from the ASX20 Index in December and from the ASX50 Index in March/June.


Newcrest/Newmont & Potential S&P/ASX Changes

United States

The S&P 500® is widely regarded as the best single gauge of large-cap U.S. equities and serves as the foundation for a wide range of investment products. The index includes 500 leading companies and captures approximately 80% coverage of available market capitalization.

S&P 500 INDEX (SPX INDEX)

Ready to Get Spooked? Properly Comparing Real Yields and P/E Ratios = Massive Downside for Equities!

If history, again, rhymes, the S&P 500 Index is heading for an ugly 6-month period as real yields continue to spiral higher.

Jeroen Blokland

Steno Signals #70 – 10 Charts You NEED to Monitor in Global Macro

Happy Sunday from Mallorca and welcome to our weekly flagship editorial. The world of Macro never fails at keeping us busy and this week I reveal...

Steno Research

Positioning Watch: Shifting Gears without Panic

I sent Congress an urgent budget request to fund America’s national security needs to support our critical partners, including Israel and...

Steno Research

The Weekly Market Monitor – Where’s the Plunge Protection Team?

China's National Team seems absent as Chinese stocks tumble, geopolitics take center stage, but still, Sentiment is not depressed enough.

Jeroen Blokland

Newcrest/Newmont & Potential S&P/ASX Changes

Newmont CDIs should replace Newcrest in the ASX indices. Using Block as a precedent, a decrease in the number of CDIs held in Oz could lead to...

Brian Freitas