As alternative investments become more mainstream, managers who traditionally have operated in the alternatives arena face a number of questions, including what is the right offering, the proper structure and how do we market the new vehicle. Guest columnist Ginger Szala examines the thought processes of one group as they made the leap to retailization.
The royal family in Qatar, the House of Thani, just took direct control of the emirate's sovereign wealth fund. Also, that fund just invested big in Uber, confirming its reputation as perhaps the worlds most aggressive deal-hunting institution.
The price of gold took a swan dive as November ended, just as Swiss voters formally nixed an initiative that would have required the central bank to buy a lot of the stuff. Faille argues that this is not a matter of cause and effect. It is, on the other hand, a fascinating case study in the discounting machinery that is a market.
In 2012, [as the crude oil price was settling in to $110 and low vol,] the renewables’ infrastructure space for private funds reached an aggregate estimated deal value of $132 billion. In 2013, that fell to $95 billion. It now seems unlikely that 2014 will match last year.
Enron was once the leader in a category of merchant traders that mediated in the world of energy commodities. Enron died, and banks largely took it over. Yet in spirit, at least, Enron is back.
A Bank of England paper discuses the "cover 2" standard for the adequacy of the default funds of central clearing houses, an issue of increasing importance as the push to centrally-clear everything picks up steam. One question it raises somewhat incidentally is the proper pronunciation of the acronym SLOIM, for "stressed losses over initial margins."
If we look for the recent peak in Dow Jones U.S. oil & gas stocks we’ll look to the start of the summer. In June of this year the energy sector got above $850. The fall from that height puts the size of our correction in the neighborhood of 16%. It is possible these stocks are leading the rest of the market down.
Two rules within the CFTC rulebook that offer exemptions for certain CPOs from certain regulatory requirements mirrored the original pre-JOBS Act Reg D on the SEC side. But of course we are now in a post-JOBS Act world, and the CFTC staff has now acted, not through a rule change but by staff letter, to harmonize with its sister agency and with the JOBS Act mandate.
Guest columnist Diane Harrison looks at the basics of managed futures.
Maria van der Hoeven, Executive Director of the International Energy Agency talks to James Stafford, OilPrice.com.
Managed futures are performing quite poorly. They also have a higher standard deviation than the HF industry aggregate, so it seems that if you're invested there your losses are at least buying you greater risk. [Wait. That can't be right.]
In 2010 AlphaMetrix held a conference in Miami with Harry Markopolos as the keynote speaker. Markopolos' claim to fame is that he told the regulators about Madoff''s Ponzi Scheme, but his words fell on deaf ears. In 2013 AlphaMetrix, which claimed to the be the transparent antidote to Madoff stood accused by the CFTC of moving money in ways it ought not and in 2014, the principals of the firm are asking for a jury trial. It is indeed a tangled web and it is unlikely to be un-weaved any time soon.
Nick Cunningham , Oilprice.com columnist, looks at new U.S. EPA regulations and the effect they may have on fracking and future oil prices.
Daniel J. Graeber, Oilprice.com columnist, on the environment and oil prices.
Guest columnist Nick Cunningham looks at the prospects for coal.
Two academics had the nerve to question a thesis dear to the heart of David Kocieniewski of The New York Times. So he struck back.
Special to AllAboutAlpha from OilPrice.com on energy in Turkey and the Ukraine
A new paper addresses a group of industrial metals, the platinum group, and suggests that its components might be a wise addition to many portfolios on CAPM grounds.
Dan Dicker talks to Futures Magazine's Ginger Szala about oil trading.
A forthcoming paper suggests that the old risk premium in crude oil futures has essentially disappeared, at least as averaged out over (rather modest) spans of time, and proposes commodity index funds as an explanation of the disappearance.
The CFTC is said to be close to issuing a concept release on high-frequency trading, pushing the regulatory process beyond the agency's earlier talkfests. Christopher Faille muses about an approach the concept release will almost certainly not advocate.
CAIA Curriculum Director Keith Black looks at CTAs.
An opinion by Chief Judge Lynch, of the 1st Circuit Court of Appeals, should have private equity managers in that Circuit reviewing their portfolios, and thinking in a more expansive way about their potential ERISA liabilities for companies they control.
Grant Jaffarian, AlphaTerra LLC, discussed the importance of messaging
Christopher Faille talks to James Rickards about U.S.-Russia relations, as Russia reaches parity with the U.S. in the gold-to-GDP ratio.
Guest columnist Andrew Beer looks at CTA performance.
The key to an equity hedge strategy in the U.S. at present is that “the basket of those stocks generating healthy profits becomes clearer to differentiate from those that are having trouble doing so” through the earnings season. PrevInvest is moderately bullish on this, but not bullish on an event-driven strategy.
Summary/excerpt: If Clark-Joseph is wrong in his worries about the "exploratory trading" of high frequency traders, he should be shown to be wrong with the use of facts and reason. He shouldn't be shushed, directly or indirectly.
Guest columnist Paul Thomas looks at the energy markets.
Welton has modeled an investment approach, specifically a multi-asset class trend following approach, and has measured how it would have performed if back-fitted into certain periods of sustained and sharp interest rate increases in the decades since the death of Bretton Woods.
We pause to mark the death of a man who, more than any other, was responsible for the creation of a spot market in crude oil in the hectic period after the Yom Kippur War.
To encourage further exchange and understanding, I went back to Mr. Rice, after reading a comment from our reader, and asked him to expand on managed funds and their noncorrelation with traditional (largely equity) investment strategies. Tags, Agriculture, Commodities, Derivatives
Three scholars find a very real possibility that there is a cause and effect relationship between index flows in the derivatives markets, at least the agricultural index markets, on the one hand and price moves in the underlying commodity on the other.
This book, The Alternative Answer: The Nontraditional Investments that Drive the World's Best-Performing Portfolios is an appeal to the retail investor, to those author Bob Rice calls "typical investors," passing along the good news that they are no longer "stuck with the children's menu of investment options."
As a three-judge panel of the D.C. Appeals Court saw it, there were two questions in the Brian Hunter case. First, did the CEA’s language encompass manipulation of NG futures contracts as part of the exclusive jurisdiction of intervener CFTC? Second, if so, was that repealed or modified by the 2005 legislation?
Ninety-one percent of the respondents to a recent survey strongly believed there was a breakdown in audit procedures in the futures world. The comments section for that question displayed what the survey sponsor, Horizon Cash Management, calls “widespread frustration and anger.”
The present global monetary situation, plainly, is not at equilibrium. Everybody else’s currencies depend upon the dollar, the dollar depends upon petroleum, and petroleum depends upon … whatever. Changes will continue (through a succession of crises if no other way can be developed) until a new equilibrium can be attained.
Last summer the CME Group's European clearing house for derivative products announced that unallocated gold would serve as collateral for margin cover. Was that the sort of illusory good news that marks the top of a trend or was that a symptom of a secular trend toward the de facto monetization of gold that will re-assert itself once the present cyclical down move is done?
The oil and gas game can be a tricky one for junior companies, but if played right the pay-off can be massive. At a time when juniors are risking a lot in volatile venues in the Middle East and Africa, Canada's Aroway Energy (ARW) is planting its feet firmly in homeland soil and in conventional plays. Why? Because for the smaller juniors this is not a long-term game and blowing all your capital to drill a single unconventional well in a risky frontier won't pay off. Canada still has plenty to offer for juniors, even though you have to kiss plenty of frogs to find the prince. The end game, after all, is merger and acquisition. James Stafford talks to Aroway CEO Chris Cooper.
Guest columnist James Stafford, Oilprice.com, interviews Synodon's Adrian Banica.
James Stafford of Oilprice.com talks to economist James Kwak about the implications of the U.S. oil and gas boom.
A speaker from the DG Internal Market and Services, EC, Jasper Jorritsma, knew that he was in the midst of a group, both on the panel and in the broader audience, that was largely skeptical of much of what is involved in MiFID II. Indeed, he seemed to relish a sort of Daniel-in-the-lion's-Den role.
As one of the participants in a conference in London last week said, running a traditional exchange was largely a matter of extracting rents, and with changes in technology and the economic environment it will be difficult going forward for exchanges to continue without changes in their model.
In the wake of Superstorm Sandy, investors are looking at energy trading and the state of the U.S. power grid.
An interview with Christoper Fix, the CEO of Dubai Mercantile Exchange - home of the largest physically delivered crude oil futures contract in the world.
If a trial set for April 2013 in the U.K. doesn't go the way trustee James Giddens wants, the U.S. customers of MFGI whose interests he represents may be out of luck with regard to some portion of their lost money, subordinated to the claims of other creditors.
Coffee is an extremely volatile market. Uncertainties affect the whole chain of production, from the planter in Colombia to the local Dunkin' Donuts. Further, accusations (or the reality of) accounting chicanery are often added to the mix.
Wealth-X, a Singapore-headquartered firm providing members with intelligence on ultra-high net worth individuals and on the privately held companies that they control, has made available its “World Ultra Wealth Report 2012-2013,” giving a glimpse of where the elite is growing, where it is shrinking, region by region and country by country. All wealth figures below […]
The great thing about the now-expiring exemption provided by regulation 4.13(a)(4) was that it didn't impose on the exempt CPO any limits on the number of participants or on the amount of futures trading the operator of the pool could conduct. The sad thing is that it is now expiring: tick-tock.
Nothing quite so recommends a gold standard, or some alternative system of currency hardening, as the increasingly absurd arguments of those who would defend the current system of competing national fiats. The Atlantic this week presented us with Matthew O'Brien's ruminations on point.