Cross-Asset Strategist & Quantitative Analyst, Pennock Idea Hub

Cam Hui

Cam Hui has been professionally involved in the financial markets since 1985 in a variety of roles, both as a quantitative equity portfolio manager and as a sell-side analyst. He graduated with a degree in Computer Science from the University of British Columbia in 1980 and obtained his CFA Charter in 1989.

Cross-Asset Strategist & Quantitative Analyst

This Gold Bull Market Is Being Made in Beijing

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

Multiple Countries / Cross Asset Strategy

The coronavirus was not the real reason for the market sell-off. The real reason was excessively bullish sentiment. The coronavirus news was just the excuse.We made the point last week that fast money positioning had become too extreme. Readings were at a crowded long and portfolio leverage was highly elevated. The market was just ripe for a bearish catalyst (see <a href="https://www.smartkarma.com/insights/the-sorcerer-s-apprentice-market-meltup" target="_blank" rel="noopener">The Sorcerer’s Apprentice Market Melt Up</a>).In that case, how should you react to the coronavirus pullback?We conclude that traders and investors need to consider their time horizons in order to navigate the latest coronavirus panic. In the short run, the market is falling because of excessive bullish positioning, and the risk-off unwind is not complete. There is more unfinished business to the downside for equity prices.Longer term, we believe that the global growth outlook remains intact. Investors with longer time horizons should use any market weakness to add to their equity positions. In particular, they should focus on non-U.S. markets, which are more reasonably valued.In other words, buy the dip – but not yet.

The coronavirus was not the real reason for the market sell-off. The real reason was excessively bullish sentiment. The coronavirus news was just the excuse.We made the point last week that fast money positioning had become too extreme. Readings were at a crowded long and portfolio leverage was highly elevated. The market was just ripe for a bearish catalyst (see The Sorcerer’s Apprentice Market Melt Up).In that case, how should you react to the coronavirus pullback?We conclude that traders and investors need to consider their time horizons in order to navigate the latest coronavirus panic. In the short run, the market is falling because of excessive bullish positioning, and the risk-off unwind is not complete. There is more unfinished business to the downside for equity prices.Longer term, we believe that the global growth outlook remains intact. Investors with longer time horizons should use any market weakness to add to their equity positions. In particular, they should focus on non-U.S. markets, which are more reasonably valued.In other words, buy the dip – but not yet.

Trading the Coronavirus Panic