Cross-Asset Strategist & Quantitative Analyst, Pennock Idea Hub

Cam Hui

Cross-Asset Strategist & Quantitative Analyst

Pennock Idea Hub

We are creators of independent equity research. The Pennock Idea Hub team are veterans of the investment industry. Much of our team has spent their careers at Merrill Lynch, Deutsche Bank, RBC Capital Markets and Wood Gundy. We have taken every aspect of research back to the studs and returned to first principles. The Pennock Idea Hub marries the interests of the sell and buy side. 

We offer the best research for institutional investors by:

-Only publishing research from veteran analysts
-Eliminate the inherent conflicts of the traditional sell and buy side relationship
-Ensure our team is always accessible; collaboration with clients nurtures our collective success

Cross-Asset & Quantitative Research

Cross Asset Strategy

<ul>
<li>The S&amp;P 500 is facing the twin macro risks of a hawkish Fed and deteriorating fundamentals</li>
<li>Based on the current 10-year yield of 2.8% and the current earnings outlook, the historical downside risk is between -10% and -30%.</li>
<li>Arguably, the 10-year yield should be much higher in light of recent core CPI readings, which would have even greater dire consequences for equity valuation.</li>
</ul>


The S&amp;P 500 is facing the twin macro risks of a hawkish Fed and deteriorating fundamentals
Based on the current 10-year yield of 2.8% and the current earnings outlook, the historical downside risk is between -10% and -30%.
Arguably, the 10-year yield should be much higher in light of recent core CPI readings, which would have even greater dire consequences for equity valuation.


U.S. Equity Investors Are Playing With Fire

<ul>
<li>While we are intermediate term cautious, our working hypothesis for the near-term outlook is a choppy market, but the S&amp;P 500 is unlikely to breach its 2022 lows.  </li>
<li>It is with this chaotic environment in mind that we suggest pairs trading as a more risk-controlled way of finding better returns.</li>
<li>We will update all of the pairs periodically. Feedback and expressions of interest are appreciated so we know how much resources to devote to the regular update to this strategy.</li>
</ul>


While we are intermediate term cautious, our working hypothesis for the near-term outlook is a choppy market, but the S&amp;P 500 is unlikely to breach its 2022 lows.  
It is with this chaotic environment in mind that we suggest pairs trading as a more risk-controlled way of finding better returns.
We will update all of the pairs periodically. Feedback and expressions of interest are appreciated so we know how much resources to devote to the regular update to this strategy.


Achieving Stable Alpha in a Chaotic Bear Market

<ul>
<li>The stock market is extended in the short run and the rally may be starting to show signs of exhaustion. </li>
<li>Momentum is still strong and it would be too soon for traders to take bearish positions.</li>
<li>We are seeing the set-up for a sell signal, which should appear soon.</li>
</ul>


The stock market is extended in the short run and the rally may be starting to show signs of exhaustion. 
Momentum is still strong and it would be too soon for traders to take bearish positions.
We are seeing the set-up for a sell signal, which should appear soon.


<ul>
<li>A short-term panic bottom is probably in, but it’s difficult to predict short-term market fluctuations in the current circumstances.</li>
<li>The situation on the ground in Ukraine is highly fluid and a jittery market is highly sensitive to headline risk.</li>
<li>Investors could focus on agriculture (MOO), aerospace and defense (ITA), and cyber security (HACK) for outperformance opportunities in the current heightened geopolitical risk environment.</li>
</ul>


A short-term panic bottom is probably in, but it’s difficult to predict short-term market fluctuations in the current circumstances.
The situation on the ground in Ukraine is highly fluid and a jittery market is highly sensitive to headline risk.
Investors could focus on agriculture (MOO), aerospace and defense (ITA), and cyber security (HACK) for outperformance opportunities in the current heightened geopolitical risk environment.


We'll Never Complain About A Lack of Panic Again

<ul>
<li>While fear levels are elevated, the market is neither panicked nor oversold, indicating there may still be unfinished business to the downside once the market bounce is over.</li>
<li>The best-case scenario will see a S&amp;P 500 relief rally that tests 50-dma resistance once geopolitical tensions fade.</li>
<li>The worst-case scenario is a break of neckline support at about 4300–4330 of a possible head and shoulders pattern, with a measured downside objective of about 3800.</li>
</ul>


While fear levels are elevated, the market is neither panicked nor oversold, indicating there may still be unfinished business to the downside once the market bounce is over.
The best-case scenario will see a S&amp;P 500 relief rally that tests 50-dma resistance once geopolitical tensions fade.
The worst-case scenario is a break of neckline support at about 4300–4330 of a possible head and shoulders pattern, with a measured downside objective of about 3800.


United States

SPDR S&P 500 ETF Trust is an exchange-traded fund incorporated in the USA. The ETF tracks the S&P 500 Index. The Trust consists of a portfolio representing all 500 stocks in the S&P 500 Index. It holds predominantly large-cap U.S. stocks. This ETF is structured as a Unit Investment Trust and pays dividends on a quarterly basis. The holdings are weighted by market capitalization.

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SPDR S&P 500 (SPY US)

U.S. Equity Investors Are Playing With Fire

Based on the current 10-year yield of 2.8% and the current earnings outlook, the historical downside risk for the S&P 500 is between -10% and -30%.

Cam Hui

Achieving Stable Alpha in a Chaotic Bear Market

It is with a chaotic bearish environment in mind that we suggest pairs trading as a more risk-controlled way of finding better returns.

Cam Hui

A Market Pause, or A Stall?

The stock market is extended in the short run and the rally may be starting to show signs of exhaustion. We are seeing the set-up for a sell...

Cam Hui

We'll Never Complain About A Lack of Panic Again

A short-term panic bottom is probably in, but it’s difficult to predict short-term market direction. The situation in Ukraine is highly fluid and a...

Cam Hui

Fearful, but Not Panicked

While fear levels are elevated, the market is neither panicked nor oversold, which is an indication that there may still be unfinished business to...

Cam Hui

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