Entries by Peter Brandt

Always Consider Risk Management

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Recent events only highlight the importance of Risk Management. Late Thursday evening and early Friday morning I spoke by phone to many of the old-timers (some with near 50-year trading careers) in whom I have the highest level of respect. There was a universal consensus – we have never witnessed markets like those experienced over such a brief period of time. Even though I had almost no exposure, I stayed up into the late hours on Thursday evening watching in awe a broad level of volatility exceeding anything I can remember. There was, no doubt, some serious blood-letting. In the weeks ahead we will read and hear about some horror stories. More than one trading firm will announce bankruptcy. We will not hear about the hundreds of individual speculators whose accounts were destroyed.

Risk Management Quick Tips

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I want to revisit some of the themes I emphasize over and over and over again. Often times I feel that my harping on issues of risk management does not fully register with Factor members — especially newer traders who have not developed an adequate respect for market volatility.

Factor Update – June 26, 2016

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Late Thursday evening and early Friday morning
I spoke by phone to many of the old-timers
(some with near 50-year trading careers) in
whom I have the highest level of respect. There
was a universal consensus – we have never
witnessed markets like those experienced over
such a brief period of time.

Brexit Exit Polling by Hedge Funds

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The British government allows large hedge funds to conduct their own exit polling. They are not allowed to release their findings until 22:00 British Summer Time (BST) — there is no prohibition against their trading based on their own Brexit exit polling.

Properly sampled Brexit exit polling in UK voting is extremely accurate (usually within a +/- 1% error). Hedge funds will have a good indication on the Brexit vote by midday BST and will almost certainly have solid data by 18:00 BST. There is an embargo on publishing results until 22:00 BST. Thus, hedge funds will have a lead of many hours over the average market speculator.

Natural Gas Rising

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The dominant chart construction in Natural Gas is the completed 7- month H&S bottom on the daily graph (Oct contract). Note the appearance of a possible 6-day flag on the Oct chart.

George Soros and the British Pound — A Case Study

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I had a fascinating email exchange with a Factor member from Cambridge University. Together we briefly pieced together the events leading up to the showdown between George Soros and the Bank of England over the value of the British Pound in 1992. The Factor member reconstructed the global macro factors that led Soros to his […]

Factor Update – June 19, 2016

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Candidate Factor Moves are currently ongoing in: Nifty 50 (SGX), Medtronic (MDT), Lean Hogs, Silver. A Factor Move successfully concluded in T-Bonds. Candidate Factor Moves were terminated in Cosmo and SCJ. A candidate Factor Move is developing in Cotton. This issue of the Factor also comments on U.S. Dollar Index, EUR/USD futures, Japan Mothers Index, 3-mo. EuroSwiss, Natural Gas, EuroStoxx, Coffee, Soybeans, Swiss Franc (see Q&A section), Crude Oil, Baytex Energy (BTE) and stock index markets. This Update also looks back at the price charts of the British Pound during the famous period when George Soros took on the Bank of England – and won.