top of page
Search
  • Marc Bentin

Main vs. Wall Street traders

Updated: Mar 21, 2021

BentinPartner Weekly



Dear Reader,


The entire story of the past week was centered on an epic fight between Main and Wall Street traders and a fast-growing army of retail traders blowing up short bets held mainly by hedge funds.


“What I’ve seen happen with GameStop this week is the craziest thing I’ve seen in 27 years in the business,” said Norm Conley, chief executive officer of JAG Capital Management.


We felt a bit the same last week.


Some very public outcry came from trading restrictions being imposed by most online brokers and during a brief period towards a handful of those stocks creating havoc. This was not a question of robbing retail investors of legitimate profits and more a question of safeguarding what is left of the sanity in these markets.


We described in some details what happened in Friday’s letter but those interested will find some interest in the following reviews.


I would only add this; D. Portnoy, E. Musk, Palihapitiya, E. Wood are the four captains spearheading this movement (revolution?). They all wear bow ties (they did before last week...) and they know how to communicate to the many people left behind by the pandemic...They are mastering the codes (caps and T-shirts included) of the young generation getting very mad indeed.


Valuation does not matter (any more and for now). It is all about the number of followers you can reach and influence...and how smart and effective you are as an influencer. In other words, it is called marketing cubed leveraged to the tune of the exponential nature of the social networking effect. It is no coincidence either that the face of the Reddit Wallstreet board represents a young Trump’s stylized face. For what it worth, the Reddit Wallstreet board is now taking 2 to 3mn additional followers a day …


(“Why Reddit Loves Elon Musk, Cathie Wood and Chamath Palihapitiya”).


One last thing. Let’s be mindful that hedge funds are “sharks, carnivores, and cannibals” and that many of them will eat each other over the whole situation, starting with Citadel who is tipped milliseconds in advance of each trade that “angry” Robin Hooders are about to place. It is no coincidence either that Citadel is long quite a few of these soured shorts from other hedge funds…


No… this is the last thing…. In all fairness, part of the problem lies as a byproduct of a global monetary policy that has completely destroyed the concept of sound money and of sound investing, saving and compounding for an entire generation of youngsters by manipulating some markets down and blowing bubbles left and right elsewhere, filling so far the pockets of already multi-multi millionaires and billionaires.



Over The Past Week…



Over the past week, the S&P500 sold off by -3,3% (-1,0% YTD) while the Nasdaq100 dropped -3,3% (0,3% YTD). The US small-cap index shed -4,4% (4,8% YTD). AAPL, AMZN, NFLX, and TSLA all dropped by 5% or more over the past week with tesla concentrating this loss in Friday’s session alone.


Cboe Volatility Index rallied 51,0% (45,5% YTD, Z-score 2,0) to 33,09.


The Eurostoxx50 suffered a similar drop, shedding -3,4% (-1,6%, Z-score -2,8).

Diversified EM equities (VWO) as one of the favored trades so that this year shed by -4,3% (3,1%), underperforming the S&P500 by-1,0%.


The Dollar DXY Index (UUP) measuring the USD performance vs. other G7 currencies gained 0,3% (0,7%) while the MSCI EM currency index (measuring the performance of EM currencies vs. the USD) dropped 0,0% (-0,1%).


10Y US Treasuries rallied -2bps (+15bps) to 1,07%. 10Y Bunds dropped -1bps (5bps) to -0,52%. 10Y Italian BTPs rallied -11bps (+10bps) to 0,64%, recouping some of their recent underperformance.


US High Yield (HY) Average Spread over Treasuries climbed 14bps (2bps) to 3,62%. US Investment Grade Average OAS climbed 2bps (3bps) to 1,05%.

In European credit markets, EUR 5Y Senior Financial Spread climbed 2bps (4bps) to 0,63%.


Gold dropped -0,4% (-2,7%) while Silver rallied 5,9% on Friday (2,2%). Major Gold Mines (GDX) shed -2,0% (-4,2%).


Goldman Sachs Commodity Index gained 0,8% (5,0%). WTI Crude dropped -0,1% (7,6%).


Have a nice week ahead and stay safe.

 

For a Timely receipt of this report and daily updates and to access our intra-day Alert system, join the BentinPartner Daily Free Trial List. You won't regret it.

 

Marc Bentin, BentinPartner GmbH

Founder, Chief Investment Officer

BentinPartner GmbH is a Swiss-registered independent financial adviser.

We deliver transparent, professional, tailor-made, and competitive portfolio management services. We help our clients build and manage their wealth, resting on the three pillars of our business values; integrity, competence, and responsibility.


For more information about our portfolio management services, check our Beliefs and FAQ.


Our premium research blends macroeconomic, political, monetary, and technical analyses to produce an actionable 360 degrees daily review of Global Financial Markets on a daily basis.

If you like our Weekly, you will love our Daily. Take a free trial to the BentinPartner Daily or visit our web site http://BentinPartners.ch

Bentinpartner GmbH is Advisor to the Phi Funds AIF, an umbrella Alternative Investment Fund registered and regulated in Lichtenstein, specialized in the management of Funds focused on physical precious metals.

 

Important Disclaimer

© Copyright by BentinPartner llc. This communication is provided for information purposes only and for the recipient's sole use. Please do not forward it without prior authorization. It is not intended as a recommendation, an offer or solicitation for the purchase or sale of any security or underlying asset referenced herein or investment advice. Investors should seek financial advice regarding the suitability of any investment strategy based on their objectives, financial situation, investment horizon and particular needs. This report does not include information tailored to any particular investor. It has been prepared without any regard to the specific investment objectives, financial situation or particular needs of any person who receives this report. Accordingly, the opinions discussed in this Report may not be suitable for all investors. You should not consider any of the content in this report as legal, tax or financial advice. The data and analysis contained herein are provided "as is" and without warranty of any kind. BentinPartner llc, its employees, or any third party shall not have any liability for any loss sustained by anyone who has relied on the information contained in any publication published by BentinPartner llc. The content and views expressed in this report represents the opinions of Marc Bentin and should not be construed as guarantee of performance with respect to any referenced sector. We remind you that past performance is not necessarily indicative of future results. Although BentinPartner llc believes the information and content included in this report have been obtained from sources considered reliable, no representation or warranty, express or implied, is provided in relation to the accuracy, completeness or reliability of such information. This Report is also not intended to be a complete statement or summary of the industries, markets or developments referred to in the Report.

#fx #forex #investing #markets #riskmanagement #bankingindustry #finances #money #traders #quants



13 views0 comments

Recent Posts

See All
bottom of page