Founder Evidente. Top rated quantitative analyst, Evidente

Sam Ferraro

Founder Evidente. Top rated quantitative analyst

Evidente

Evidente is an independent financial education firm that delivers innovative financial advice to wholesale investors, including active long only funds, hedge funds, pension funds, and sovereign wealth funds, in Australia and globally.  Drawing on academic research in asset pricing, behavioural finance and portfolio construction, Evidente provides wholesale investors with commercial solutions to stock selection and asset allocation decisions across equities and other asset classes.

Thematic (Sector/Industry)

Australia Financials / Thematic (Sector/Industry)

<p>The RBA&rsquo;s recent communications continue to draw attention to the central bank&rsquo;s view that the Australian dollar remains relatively high given the decline in commodity prices and the state of the economy, and that a lower exchange rate is needed to achieve balanced growth in the economy.&nbsp; I develop a model of the Australian dollar that produces better out of sample performance during the Federal Reserve's zero interest rate policy.&nbsp; This and a modified model based on purchasing power parity suggests that the A$ is modestly under-valued relative to the US$,&nbsp; which has important implications for currency traders and the performance of Australian stocks with material US$ exposure.</p>

The RBA&rsquo;s recent communications continue to draw attention to the central bank&rsquo;s view that the Australian dollar remains relatively high given the decline in commodity prices and the state of the economy, and that a lower exchange rate is needed to achieve balanced growth in the economy.&nbsp; I develop a model of the Australian dollar that produces better out of sample performance during the Federal Reserve's zero interest rate policy.&nbsp; This and a modified model based on purchasing power parity suggests that the A$ is modestly under-valued relative to the US$,&nbsp; which has important implications for currency traders and the performance of Australian stocks with material US$ exposure.

A new narrative for the Australian dollar in a zirped-up world