Category: DAILY INSTAGRAPH

Following up on yesterday’s comment on gas prices in Europe, we would like to put forward Equinor, one investment we hold in our portfolios. Equinor is Norway’s state-owned energy company. As one of the largest gas exporters in Europe, Equinor is well-positioned to capitalize on this growing demand. Equinor’s mature infrastructure, low-emission production, and extensive … Continued

Many European countries remain heavily dependent on Russian gas. Annually, Russia ships around 15 billion cubic meters of gas to Europe via Ukraine, primarily to Slovakia and Austria, where it remains a dominant supplier. In Austria, Russian gas has accounted for more than 80% of consumption for the past five months. Europe also imports Russian … Continued

According to the late value investor Charlie Munger, “There are only three ways a smart person can go broke: ladies, liquor, and leverage.” This principle applies to investors engaged in the yen carry trade as well. Recent days have shown that the substantial amounts borrowed in yen and invested in risky assets denominated in other … Continued

The VIX index, which measures the coming volatility of the stock market implied by call and put options on the S&P 500 for the coming month, surged to 65 yesterday. This marks the largest increase since the index was created in the late 1980s, comparable to spikes seen during the COVID-19 pandemic and the Lehman … Continued

Over the last week market sentiment has radically changed. Markets are back to worrying about a hard landing and a policy mistake by the Fed. Bond markets are now implying a 94% chance of more than 3 rate cuts of 25 bps in 2024. Latest US economic data, namely unemployment data and ISM survey, came … Continued

Contrary to what we typically learn in business school, long-term interest rates in the US have significantly declined, yet global equity markets are experiencing a downturn. The US 10-year Treasury yields have fallen below 4%, with swap traders now fully anticipating three rate cuts this year. This shift is driven by growing investor concerns over … Continued

Based on yesterday’s Federal Reserve meeting, while there hasn’t been a move yet, the likelihood of a rate cut in September is high. A compelling study from Goldman Sachs examines the typical behavior of the S&P 500 following the first rate cut, drawing on data from 1984 and analyzing eight Fed cutting cycles. Over the … Continued

A comprehensive study examining 29,078 publicly traded U.S. companies from December 1925 to December 2023 reveals a surprising finding: 51.6% of these companies resulted in losses for their investors. Despite this, the average return across all companies was 22,840%, largely driven by a small number of exceptional performers. Notably, 17 companies achieved total returns surpassing … Continued

Over the next two days, the Bank of Japan, the Federal Reserve, and the Bank of England will convene to determine their monetary policies. According to Bloomberg’s World Interest Rates Probabilities function, which calculates implied policy rate probabilities from futures and swap prices, financial markets anticipate rate cuts this year for all except Japan. A … Continued

In the US, investors are currently rotating their equity portfolios out of technology Mega-tech and into small-cap stocks. Notably, the Russell 2000 has outperformed the Nasdaq by 13% in July so far. However, this growing appetite for small caps has not reached Europe. In Germany, for instance, large-cap stocks are still outperforming the MDAX, which … Continued