Structural Inefficiency Trade
Most MBS securitizations contain a call right that is vested with the servicer of the bonds. Imagine a pool of 4,000 30-year mortgages. By the time year 29 comes around, there may be less than…
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A Permanent Shift to Stock Valuations?
During extended bull markets, rationalization becomes commonplace to justify overpaying for value. One such rationalization is the permanent shift in valuations higher due to changes in…
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Five Reasons the Fed’s New Policy Won’t Get Inflation
So, to be clear, the Fed’s new policy is simply to “average the inflation rate” over a period of time and let the unemployment rate fall to as low as 2.5%. The last time the unemployment rate…
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Using Long Volatility Exposure to Hedge a Portfolio
Investors need to understand that the Cboe Volatility Index (VIX) is not the same as VIX futures, and this has important implications when it comes to trying to hedge a portfolio with a long…
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Litigation Trade Example
The managers identified a bond where the servicer was not correctly interpreting the payout. In this case, the servicer was paying the principal on the bonds to an insurance company before the…
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Do Low Interest Rates Justify High Stock Valuations?
The belief this time is different from the past has always been the most dangerous of phrases for investors. However, this is where participants exist today. While it is true the excessive…
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Fundamentally Speaking: Earnings Don’t Support Bullish Thesis
With the second quarter of the 2020 reporting season mostly behind us, and with markets testing “all-time” highs, do earnings support the bullish thesis? Such is the fundamental question…
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The Case for Non-Traditional Fixed Income in Every Rate Environment
In this case study we will take a close look at the large, liquid and mature $1.2 trillion U.S. senior secured corporate loan market. In this study, we present our case for loans in every rate…
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#Macroview: Why Soros Just Called the Market A Bubble
In a previous post "Market Bubbles," I touched on George Soros' "theory of reflexivity." Interestingly, MarketWatch discussed with George why he no longer participates in the "bubble." The…
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Bulls Charge to All-Time Highs
While weaker economic data has not yet dented the “bullish sentiment” at this juncture, it doesn’t mean it won’t. However, as we have discussed over the last several weeks, a breakout of the…
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Adding Alternatives: Allocating to Hybrid Strategies
What Golf and Investing Can Tell Us About the Benefits of a Hybrid Approach
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Hybrid Strategy Allocation Calculator
The interactive Catalyst Insights Allocator Tool lets users understand the historical impact of implementing a hybrid strategy into a traditional 60/40 stock/bond portfolio.
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