onsdag den 4. april 2007

Waiting, waiting and waiting...


Now it's Easter which needs to run of. Always new things to wait for - being a fund manager there are really a desperate need for "sitting around" doing nothing. No wonder carry-trading is so popular! At least you get paid for waiting.

The market had spur of activity in early February which made us oldtimers relish in the trading conditions. Now we are back to measuring pico-changes in relative yield differentials and watching latest Private Equity deal being announced.

The 100 bln. USD PE-deal is not far away!

Having said all that our generic models are kicking some good old a.. even in February. Raking up gains more than 300 bps for the year to date is pretty good considering the end of carry-trading being announced in early February.

Personally, I am neither here or there in terms of market direction. I am trying to figure out if inflation or lack of growth the most likely scenario. I promise you I have no illusions to ever figuring it out, but the never the less I need to pretend doing something.....

My positioning is boring; I am long some 2-10 y steepning, which is really 2-8 in technical terms due to cheapest-to-deliver is a 8 year paper. I am long GBP vs EUR, based on continued tightning bias of Bank of England.

Got some fat-tails lottery tickets in EUR.USD, mainly on the upside. Remembering how Thanks Giving Holiday got market excited. The issue though, Easter is more of a European than US holiday although Pass Over co-indicedes........

Would love to play odd of lower corn. Corn been down in 16 of 18 month according to the Commodity Almanac - as planting season comes into play.

Crude - I can't trade in geopolitical markets, but got nasty feeling that crude soon will take out 70 USD. Not based on Iran but on pure poor supply side of the production. I spend some quality time with Lehman last week ,their analyst being very bid based on purely sound fundamental reasons........

Well, enough is enough I am drained - doing nothing is too hard for me.

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