February 4, 2015
“The interbank market is pricing in a ~67% chance of a back-to-back interest rate cut from the Reserve Bank of Australia (RBA). Despite this week’s ‘unexpected’ rate cut, it is easy to argue that the overwhelming consensus in the professional community is for a further weakening in Australia’s terms of trade and, as a result of that, the Australian Dollar (AUD) will have to trade much lower,” said Rareview Macro founder Neil Azous in a note out Wednesday.
January 23, 2015
Neil Azous, Founder and Managing Member of Rareview Macro, published his thoughts on what he believes should be the key takeaways for investors from last week’s Swiss National Bank abrupt change in monetary policy. This is not a trading piece or recap of the events but an attempt to draw some of the enduring lessons from the past about how central banks and markets work with, and sometimes against, each other.
January 14, 2015
“The explanation for why some investors are finally going long of the miners is simple: A sharp drop in energy prices, positive foreign currency effects, major cost reduction programs and gold prices that have recovered to within 2% of year-ago levels. Against that backdrop, the gold miners should finally recover,” said Rareview Macro found Neil Azous in a note out Tuesday.
“Additionally, this is a classic example of buy-hold-sell research analysts finding themselves behind the curve. The key point here is that despite the positive catalysts listed above, the analyst consensus still expects gold miner earnings to decline this year. Anyone who is now buying the Miners clearly views the events as moving faster than analysts are able to react, and while they wait for clarity before revising their earnings projections the stock prices will go up a lot,” adds Azous.
SiriusXM – Business Radio
January 9, 2015
Neil Azous, Founder and Managing Member of Rareview Macro, discussed his latest global macro trading views on Behind the Markets, a SiriusXM® radio show hosted by Professor Jeremy Siegel, a world-renowned expert on the economy and the author of the award-winning investment classic Stocks for the Long Run, and Jeremy Schwartz, the Director of Research at WisdomTree, an ETF sponsor. Business Radio (channel 111) is powered by The Wharton School at the University of Pennsylvania.
December 11, 2014
“Professional investors are trying to bottom-pick the energy sector through single-stock and ETF options,” Neil Azous, founder of Stamford, Connecticut-based research firm Rareview Macro, said in a phone interview. “They’re buying what they perceive as value in a defined risk profile through the options market given the unknown floor in crude oil prices.”
December 10, 2014
“One of the key concerns highlighted from the BIS in their latest report is the speed and degree at which Emerging Market corporations have increased their US Dollar based funding,” said Rareview Macro founder Neil Azous in a research note out today.
“While we hold the view that charts show you possibilities, and are not predictions, and we are not sure if these two technicals are the best metrics when analyzing emerging market debt charts, the fact is that a death-cross where the 50-day moves down and through the 200-day moving average is going to be confirmed this week statistically and that coincides with a break of a multi-year trend line with multiple touch points,” said Azous.
November 24, 2014
“Now a lot of US investors have asked why HEDJ’s performance has been sub-optimal. Specifically, why isn’t this strong dollar-weak euro not playing out much like last year’s Japan trade (strong dollar, weak yen) as we saw with DXJ,” said Rareview Macro founder Neil Azous in a note out Monday.
“So HEDJ is working exactly the way it should given how it is constructed and using HEDJ to get long European stocks and a weaker EUR is the correct instrument for that view,” said Azous. “In the end, the difference between HEDJ and DXJ is simply stock performance, not the currency.
November 24, 2014
1. The year appears to be concluding where it started for macro investors, generally disappointing. Take us back to the beginning and tell us what’s gone wrong?
Azous: Most macro investors struggled out of the gate in January as the U.S. dollar, equities, and yields all declined. These trades were left over from profitable positions in December 2013 and reversed sharply on the first trading day of the year. Pension rebalancing was an obvious culprit for driving the equities lower/bonds higher price action, which was then amplified as macro investors exited their positions. Although U.S. and Japanese equities have subsequently rebounded and climbed to new highs, on a global basis stock market performance has been much less impressive. Moreover, trying to position for an incipient tightening cycle in the U.S. has proven extraordinarily challenging, as neither yields nor volatility have moved in accordance with most macro managers’ expectations. While the dollar trade has generally come good, there have been a couple of gut-wrenching pullbacks that forced many managers to stop out of what would otherwise have been profitable positions.
Hedge Fund Insight
November 19, 2014
Most of us hand over dollar bills every day without ever really looking at them very closely. They are too familiar. But if you pause to look closely at the one dollar bill, you will see, right below the one-eyed pyramid, the Latin phrase “Novus Ordo Seclorum”.
The literal English translation of that is “a new order of the ages.” Taken from a book by the Roman poet Virgil, it first appeared on the Seal of the United States, and made its way onto the currency in 1835, where it has stayed ever since. Virgil was not a man to use words carelessly, so when he wrote it, he must have intended to emphasize “new” and, therefore, put it first in the sentence and in front of “ordo.”
November 7, 2014
As macro advisor Neil Azous of Rareview Macro wrote in a recent note: “It is important to note that a lot of professionals have deployed more risk to currencies and new risk to commodities. So their ability to add a long position in equities is now lower and no one wants to buy these highs.”