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Volatility Shocks Have Consequences
"Volatility's your exposure toggle."
You've heard that tagline before. It's one of several attributed to Nomura's Charlie McElligott, who appeared earlier this week on a hastily-convened, "emergency" episode of Bloomberg's Odds Lots podcast. Technically, the McElligott chat was for "Lots More," a kind of Odd Lots spinoff.
Regular readers (and everyone else for that matter) are encouraged to listen to the discussion here. It's mostly a reiteration of McElligott's recent notes, but it's a joy to
This is good info. thanks!
Thank you.
The chart suggests there was around a $125 billion reduction in equity postions. That’s some serious money there.
I’m surprised that the stability/buy again requirements hurdle is so high.
Fun fact: Charlie’s undergraduate degree was in government with a focus on international relations. Dartmouth man. Endorses a diet regimen that has the potential to solve the globe’s overpopulation problem, too, hahaha
Are you suggesting that he is a woke vegetarian dilatant? So much for his thoughts, eh?
If you spent a few seconds researching his diet online, you’d see it’s the exact opposite. And I might be using the word “solve” ironically.
Owlsey Stanley.aka the bear, ended up moving to Australia to be better able to pursue.his meat-only diet.
I still loved him
H-Man, thanks for the link to the podcast. Next week may tell us more about whether vol is settling in or ripping higher. I liked his comments about the carry trade not really having much of an influence in the debacle that happened a few days ago.
Ditto re the podcast link. Also, just want to say I enjoy all posts on McElligott’s views.
CTA funds have more selling to do, per GS. Not giant amounts, but not small – low to mid tens of $BNs I think.
Sounds from McEligott that vol-based funds will not be significant buyers for at least a month.
What major +ve and -ve catalysts in the coming month? NVDA report. Middle East. Macro bad news is bad and I suspect good news could be spun bad, with FOMC in Sept and grown men still begging for flocks of doves.
OTOH, lots of charts at their 200D. And traders who aren’t entirely rules-based will be looking at prices 10-15-20% more attractive than a few weeks ago, on estimates that have held up – reading that 3Q estimates have been trimmed less than normal.
Implies indicies flat to weak for near future?