Emerging markets
Using ESG as a Risk Management Tool
Dec 10th, 2020 | Filed under: Newly Added, Risk management, The Global Economy & Currencies, Emerging markets, ESG, Risk Management Strategies & Processes, Other Topics in A.I.In the first half of 2020, a period dominated by the spread of the Covid-19 virus and by the shut-down of economic activity in country after country around the world, investing with an eye to environmental, social, and governance issues proved valuable as a risk management measure, according to anRead More
How Green is the Cannabis Trade?
Oct 12th, 2020 | Filed under: Newly Added, The Global Economy & Currencies, Emerging markets, Frontier marketsLast week we looked at recent developments in the state-legal marijuana markets. Among the observations we made there, these three stand out: Marijuana is becoming an essential business and a permanent feature of the landscape, surviving crises and helping the portfolios of investors do the same; The major players areRead More
Emerging Market Debts (or Funds) as a Weakened-Dollar Bet
Sep 15th, 2020 | Filed under: Newly Added, The Global Economy & Currencies, Emerging markets, Other Issues in Private Investments, Finance & EconomicsA new report by the William Blair Funds illustrates why some investors may see emerging-markets debt as a good play over the near future, especially if the assets of the funds are denominated in the local currency. That is a play on dollar weakness. The report uses the JPMorgan GovernmentRead More
Opportunities Emerge in Emerging Markets Debt
Jan 5th, 2020 | Filed under: Currencies, Newly Added, The Global Economy & Currencies, Emerging markets, Business News, Economics, The A.I. Industry, MacroeconomicsA new year ushers in new opportunities and 2020 is no different in that respect. Emerging markets debt is one such opportunity, according to the global fixed-income team at Morgan Stanley Investment Management. In its new report, MSIM sees “attractive opportunities in countries displaying disinflationary or stable inflation dynamics andRead More
SHARE BUYBACKS OR COMPOSITE EQUITY ISSUANCE?
Jan 1st, 2020 | Filed under: CAPM / Alpha Theory, Financial Economics Theory, Newly Added, The Global Economy & Currencies, Emerging markets, The A.I. Industry, Institutional Asset Management, Finance & EconomicsBy Daniel Fang, CFA, CAIA, Quantitative Research, and Diana Olteanu-Veerman, CFA, Quantitative Strategy, Northern Trust Asset Management Composite Equity Issuance (Cei) Can be a Proxy for Intangible Returns Anomalies Even though factor investing is widely supported in academia and investment practice, forecasting and harvesting factor returns remains challenging for various reasons.Read More
Africa: Alpha for the Bold
Dec 15th, 2019 | Filed under: Infrastructure, Newly Added, The Global Economy & Currencies, Emerging markets, Operationally Intensive Real Assets, Economics, The A.I. Industry, Frontier markets, MacroeconomicsThe CFA Institute, in conjunction with the African Stock Exchanges Association (ASEA), has put together a book on the challenges and opportunities in the African capital markets. In Africa as elsewhere, fortune favors the bold. For example—and this is not an example from the ASEA and CFA Institute’s book—the EnkoRead More
Quants in China: Which Factors Work?
May 28th, 2019 | Filed under: Hedge Fund Strategies, Equity Hedge Funds, Newly Added, The Global Economy & Currencies, Emerging markets, The A.I. Industry, Hedge FundsThe outperformance of the size, value, and reversal factors is strong, but the momentum factor, which has performed well in the U.S., does not work in China. This is the conclusion of a new white paper published by Neuberger Berman about quantitative investing in China A shares. It has aRead More
The Two Faces of Investing in Renewables
May 27th, 2019 | Filed under: Hedge Fund Strategies, Investing in Commodities, Equity Hedge Funds, Newly Added, Socially responsible investing, Event-Driven Hedge Funds, The Global Economy & Currencies, Emerging markets, Alternative energy, Commodities: Examples, Energy, The A.I. Industry, Frontier markets, Hedge Funds, Emerging Alternative Investments, SRI and Clean Energy, Other Topics in A.I.Renewable energy, however defined, is widely seen as a sustainable and socially responsible (and, if the investing is done right, very profitable) addition to one’s portfolio. Indeed, such entities as the Institute for Energy Economics and Financial Analysis, an Ohio based research-and-analysis shop, exist to show that renewables are theRead More
Alpha: The Rise of the Middle Class in Emerging Markets
Feb 21st, 2019 | Filed under: Investing in Commodities, Financial Economics Theory, Newly Added, The Global Economy & Currencies, Emerging markets, The A.I. Industry, Commodities, Finance & EconomicsA new paper from State Street Global Advisors takes a sociological approach to the search for alpha in emerging market nations. It contends that the “major theme for growth” in the emerging markets moving forward will be “based on the rise of the middle class and rising consumption in theseRead More
An Emerging Market Nation Defaults: A Case Study
Jan 24th, 2019 | Filed under: Newly Added, Emerging markets, The A.I. Industry, Finance & EconomicsA new book by Hassan Malik may serve as a caution for alternative investors operating in the emerging markets, in the form of a case study about the politics of default. Malik is an emerging markets strategist at Ned Davis Research in London. His new book, Bankers and Bolsheviks, beganRead More
Nick Pollard: The View from Mumbai
Jan 21st, 2019 | Filed under: Newly Added, The Global Economy & Currencies, Emerging markets, Economics, The A.I. Industry, Hedge Funds, MacroeconomicsOn Jan. 11, the CFA Society India hosted the 9th Annual India Investment Conference in Mumbai. CAIA was a platinum sponsor of this event. The theme of this year’s IIC was “investing insights for uncertain times.” Nick Pollard, Managing Director, Asia Pacific at CFA Institute, kicked things off with aRead More
McKinsey on Asia’s Asset Managers
Dec 16th, 2018 | Filed under: Industry Size & Managers, Newly Added, Asset Managers, Regulatory, Regulatory Environment, The Global Economy & Currencies, Emerging markets, Economics, The A.I. Industry, Allocating to A.I.Assets under management for Asia’s managers have ballooned in the last 10 years, with an increase on average of 9% annually. Performance has been such as to encourage inflow. A recent study by McKinsey suggests that the “good times” will “keep rolling.” But it also cautions that the opportunities inRead More
Shariah Finance, Volatility, Clientele Effects
Oct 23rd, 2018 | Filed under: Financial Economics Theory, Newly Added, The Global Economy & Currencies, Emerging markets, The A.I. Industry, Frontier markets, Finance & EconomicsTwo recent scholarly papers take distinctive looks at the sukuk market in Malaysia. Accordingly, each contributes to the ongoing discussions and evaluations of the place of Islamic finance within the broader global (and alpha-seeking) picture. Sukuk are bond-like instruments structured to pay profit, not interest, that are sold chiefly toRead More
Modi Operandi
Oct 1st, 2018 | Filed under: Newly Added, The Global Economy & Currencies, What about beta?, Emerging markets, The A.I. Industry, Frontier markets, MacroeconomicsBy Bill Kelly, CEO, CAIA Association What’s your liquidity M.O.? If you are less than certain, it is time to look east toward the country of India and the land of Modi. After all, when 1.3 billion people cough there is a decent chance the rest of the world justRead More
The View from Las Vegas: Quiet Buying? Aggressive Buying?
Sep 23rd, 2018 | Filed under: Newly Added, Emerging markets, Digital currencies, Alternative Investments in Context, Commodities: Examples, The A.I. Industry, Gold, Commodities, Emerging Alternative Investments, Personalities in AIOn Sept. 24, the 9th Annual Inside Alternatives and Asset Allocation event convenes at Wynn Las Vegas, with CAIA sponsorship. The purpose of the event: to look beyond traditional alternative investments and strategies, to take the measure of a new breed of alternatives, including impact/SRIs, cryptocurrencies, and the application ofRead More
Prepping for an Emerging Market Rebound
Sep 17th, 2018 | Filed under: Currencies, Newly Added, The Global Economy & Currencies, Emerging markets, The A.I. Industry, Finance & EconomicsTwo executives at the Neuberger Berman Group have prepared a paper on what they call the “overall case for a recovery in emerging market debts” in the months to come. Investors will want to “be around” for such a rebound, they say. There are obviously now, and there will continueRead More
Africa Still Rising (but Patience May Be Required)
Jun 12th, 2018 | Filed under: Private Equity, Newly Added, The Global Economy & Currencies, High-net-worth investors, Emerging markets, Emerging Alternative Investments, Private Investments, Other Topics in A.I.The Emerging Markets Private Equity Association, in a new report, suggests that the “Africa Rising” narrative of a few years ago is behind us. Africa is seen still as having enormous potential. But the report also says, “the commodity downturn of the last several years has had a severe impactRead More
The Case for Bargain Hunting in South Africa
Apr 18th, 2017 | Filed under: Currencies, Newly Added, The Global Economy & Currencies, Emerging marketsCharles Roth, of Thornburg Investment Management, has made the case that markets have over-reacted to the recent political shake-up in South Africa, driving asset prices below their underlying value. Thus (although Roth doesn’t put the point quite this bluntly) this could be a time for some bargain hunting. Finance MinistryRead More
Natixis asks 500 institutional investors to look into the future
Dec 20th, 2016 | Filed under: Newly Added, The Global Economy & Currencies, High-net-worth investors, Emerging markets, Institutional Asset Management, Allocating to A.I., Finance & EconomicsNatixis Global Asset Management has released the results of a survey of 500 institutional investors, asking them their views on prospects for 2017. The surveyed institutions expect that political and economic developments could cause an increase in volatility in the year to come, and active managers have to reset theirRead More
Private Equity Placements in China
Dec 8th, 2016 | Filed under: Private Equity, Currencies, Newly Added, Benchmarking & Performance Attribution, The Global Economy & Currencies, Emerging markets, Private Investments, Allocating to A.I.A new paper by G. Nathan Dong and two other scholars investigates private equity placements in China and their consequences for the issuing firms. The study works from a natural experiment that resulted from regulations created by the PRC ten years ago. In 2006, the China Securities Regulatory Commission issuedRead More
Venezuela: Thinking of Cromwell and Crude
Oct 13th, 2016 | Filed under: Newly Added, The Global Economy & Currencies, Emerging markets, oil, Commodities: Examples, Commodities, Finance & EconomicsHedge funds, among them some of those the unsympathetic call “vultures,” bought into the bonds of the Petróleo de Venezuela SA (PDVSA) early this year. PDVSA is Venezuela’s state-owned oil company, the consequence of nationalization forty years ago. Its fate turns on (a) the vagaries of post-Chavez politics in thatRead More
The Next Crisis: BIS Warns of ‘Financial Vulnerabilities’ in EME/NFCs
Aug 25th, 2016 | Filed under: Currencies, Newly Added, The Global Economy & Currencies, Emerging markets, Macroeconomics, Finance & EconomicsIn a recent paper submitted to the G20’s working group on international financial architecture, scholars with the Bank for International Settlements have warned that an accumulation of debt in the years since the global financial crisis has left the emerging market economics (EMEs) vulnerable to capital outflows. The authors ofRead More
Latest News on Argentina and the Pari Passu Clause
Feb 25th, 2016 | Filed under: Newly Added, Insolvency, The Global Economy & Currencies, Emerging markets, Business News, Finance & EconomicsThe Hon. Thomas Griesa, of the U.S. District Court for the Southern District of New York, has issued an “indicative ruling” in response to a motion by the Republic of Argentina.Read More
Emerging Markets in 2016: Making Necessary Distinctions
Jan 3rd, 2016 | Filed under: Currencies, Newly Added, The Global Economy & Currencies, Emerging markets, Finance & EconomicsThe present depressed state of commodity prices spells continued trouble for those companies that export said commodities, but also spells opportunity for those that import and make use of them. Some thoughts from Neuberger Berman, with an addendum from BlackRock. Read More
An Official Keynesian Reading of Cap Inflows and Emerging Markets
Oct 18th, 2015 | Filed under: The Global Economy & Currencies, Emerging marketsOlivier Blanchard has just stepped down as the chief economist of the International Monetary Fund, a post he has held since 2008. Faille looks at a new article that may be considered his parting shot from that parapet.Read More
Javert Frustrated Again: This Time in the Second Circuit
Sep 8th, 2015 | Filed under: Insolvency, Emerging markets, Legislation/Court rulingsNML tried to get around the sovereign immunity of Argentina's Central Bank by arguing that it and the Republic were only one entity (the "alter ego" theory developed by the U.S. Supreme Court in an opinion concerning Cuba, in the 1980s), and that the one entity involved has waived its/their immunity. No dice. Read More
Another Southeast Asia Currency Crisis
Aug 17th, 2015 | Filed under: Currencies, Forex, Emerging marketsChina's moves in recent days seem likely to set off a new Southeast Asia currency crisis, which will look a lot like the old Southeast Asia currency crisis. This was clear even on August 11th, when traders in the rest of the world were apparently working on the premise that China's move that day was a one-off. Read More
PwC Looks Ahead to 2020: Offers a Roadmap for Alternative Investment Managers
Jul 5th, 2015 | Filed under: Hedge Fund Industry Trends, Hedge Fund Strategies, Infrastructure, Technology, Emerging marketsPwC offers a glimpse of a 'day in the life' of a typical compliance analyst in 2015 and again in 2020. As these authors tell it, the day is filled with data, darkness, and drudgery at present, but it will be airy, alliterative, and analytical in another five years. Read More
Mladina on Peeling the Onion: Looking for Idiosyncratic Skill
Jun 21st, 2015 | Filed under: Performance, Analytics & Metrics, Currencies, Indexes, Emerging marketsFactor models will evolve as researchers untangle what value is to be attributed to what factor. Model selection, then, has to remain flexible to keep pace with such research, and must of course remain useful for the investment decision makers. Read More
Corporate Governance: Sunday in the Park With George
May 19th, 2015 | Filed under: Regulatory, Emerging marketsThe controversy over corporate governance, and whether the changes favored by reformers show up as superior corporate performance (as measured, for example, by Tobin's q) strikes Faille as dangerously abstract. The only way to get to the pointillist painting is by starting with particular data points. Read More
Malaysia and the Sukuk World
May 4th, 2015 | Filed under: Socially responsible investing, Emerging marketsMoody’s Investor Services has assigned a provisional A3 rating to a $750 million multi-currency sukuk issuance program established by Telekom Malaysia Berhad. Meanwhile, also in Malaysia....Read More
Eurekahedge on Asia in March, and on Asia Over the Years
Apr 28th, 2015 | Filed under: Performance, Analytics & Metrics, Hedge Fund Strategies, Currencies, Indexes, Emerging marketsAccording to Eurekahedge the hedge fund industry globally returned $54.1 billion in performance gains in the first quarter 2015. This is the greatest first-quarter gain since before the global financial crisis. Read More
EDHEC: Geography is Not Just a Listing or Headquarters
Apr 12th, 2015 | Filed under: Alpha Strategies, Risk management, Asset allocation, Emerging marketsIndexes labeled as representing developed market equity include companies with significant and increasing exposure to macro-economic trends in the emerging markets. A portfolio that tracks such an index may well have much more such exposure than its managers or investors had bargained forRead More
Zulauf Sees Unprecedented Risks: Zhou Fears Deflation
Apr 7th, 2015 | Filed under: Currencies, Emerging markets, MacroeconomicsFelix Zulauf is the principal of Zulauf Asset Management, and a former global strategist for the UBS Group. He said that central banks have intervened on such a large scale of late that they have left "global financial markets ... more distorted than ever before and accordingly the risks are very high." Read More
Eurekahedge Airs Wide Range of Views on Indian Hedge Funds
Feb 16th, 2015 | Filed under: Alpha Strategies, Indexes, Emerging markets, Alpha SeekersA new report from Eurekahedge tries to go beyond some obvious observations about the performance of hedge funds there in 2014, or about the performance of that country's broad economy last year. Eurekahedge talked to seven experts in the field. They took quite different views on the most basic of questions. So different that a contrarian would have a tough time finding the consensus to counter. Read More
Recent Russian Investment History: Misty Water-Colored Memories
Feb 8th, 2015 | Filed under: Hedge Fund Strategies, Emerging markets, Frontier marketsWilliam Browder's new book, Red Notice, is a fascinating window into the recent history of Russia, both when Yeltsin (and at first Putin) welcomed foreign investment and then when things turned very ugly for those investors. Read More
Explaining Why the Portfolio-Barbell Works
Jan 20th, 2015 | Filed under: Liability Driven Investing, Risk management, Emerging marketsMost efforts to introduce "entropy" into finance have seen it as a quantity to be minimized. A new paper, which begins as an effort to explain barbell portfolios, uses entropy in a different manner. Unfortunately, it doesn't really end up clarifying those barbells. Read More
Top 5 Alpha Stories of 2014
Dec 30th, 2014 | Filed under: Commodities, Alpha Hunters, Emerging marketsIn the middle of the year now ending, the U.S. Supreme Court delivered as complete a victory as it could manage to the hold-out bondholders in the Argentine-default dispute. Enforcement efforts plod on, and it seems likely a related story could make our top five list next year, too. Read More
Money Markets: The Cure to What Ails the Sukuk Space
Dec 22nd, 2014 | Filed under: Behavioral finance, Emerging marketsTwo World Bank economists review the impediments that face the growth of the sukuk market, impediments often inherent in the theological precepts that gave rise to it. Part of the solution: well-functioning money markets as a context for sukuk issuance. Read More
Wars and Failed Mergers Make for a Tricky October
Dec 1st, 2014 | Filed under: Performance, Analytics & Metrics, Risk management, Emerging marketsOnly two hedge fund strategies performed in the positive numbers in October, the rest were all in the red. Managed futures did best, according to the Eurekahedge numbers, benefitting from their short positions on oil prices. Read More
GFIA Hedge Fund Manager Review: The End of an Era
Nov 3rd, 2014 | Filed under: Performance, Analytics & Metrics, Alpha Strategies, Emerging marketsIn what will be its last regular monthly report on such matters, GFIA tells us that a sharp correction hit markets in Asia ex Japan in September, and tells us of some of the funds that defied the outgoing tide. Read More
Hedge Funds: Good Run for India, but Troubles in Brazil
Oct 21st, 2014 | Filed under: Performance, Analytics & Metrics, Indexes, Emerging marketsIndia accounts for much of the positive showing of Asia ex-Japan in the hedge fund world YTD. That positive showing, in turn, may be attracting asset flow. Read More
GFIA Ruminates on Academia and Practice
Oct 9th, 2014 | Filed under: Hedge Fund Strategies, Alpha Strategies, Emerging marketsGFIA shares some ruminations about the relationship between the abundant academic work on alternative investment and the insights of practitioners. Meanwhile, the Bank of Japan seems to be engaged in some ruminations of its own, and practitioners have to await the results.Read More
Hong Kong Shariah-Compliant Launch Sells
Sep 22nd, 2014 | Filed under: Behavioral finance, Emerging marketsIf I should declare that I will never eat duck, and then I simply re-name certain ducks “chickens” and eat them, then people who genuinely as a matter of principle refuse to eat duck may consider me a false friend. And those who have no objection to the eating of duck may think me a silly goose. Read More
BIS to US Fed: You’re Messing with the World
Aug 25th, 2014 | Filed under: Currencies, Forex, Emerging marketsThere are several channels for spill-over effects, whereby the actions of the Federal Reserve and the ECB can have grave consequences around the world. Psychological consequence, in particular herding, is among them. Read More
Eurekahedge: Europe-Focused Managers Took Hits in July
Aug 20th, 2014 | Filed under: Performance, Analytics & Metrics, Emerging marketsBanco Espirito Santo, and its CEO Salgado, had emerged from an earlier round of crisis (way back in 2012) with a roseate smell. Their latest smell ... not so good. Read More
All Regional Mandates in Positive Territory YTD
Jul 28th, 2014 | Filed under: Performance, Analytics & Metrics, Alpha Strategies, Emerging marketsThe latest report from Eurekahedge mentions that though instability is "brewing again in the Middle East," things have settled down a bit in Eastern Europe. This report was written prior to the shoot down of a Malaysian jet over the Ukraine. Read More
Looking at the Future of World Wealth McKinsey-style
Jul 21st, 2014 | Filed under: Institutional Investing, Emerging marketsIn Asia the high-net-worth population still consists largely of the first-generation wealthy. So: what are these Asian entrepreneurs looking for in their private banking services? That is one of the questions McKinsey considers. Read More
Why Yellen is Wrong on ‘Resilience’
Jul 13th, 2014 | Filed under: Currencies, Emerging marketsThe Chair of the Federal Reserve cannot with any plausibility look upon market bubbles as something exogenous, something that just happens to the earth, like a meteor shower, something from which she and others in her august circles can seek to protect us. Read More
May Numbers: Long Equity Beats Event-Driven Peers in Asia
Jul 8th, 2014 | Filed under: Alpha Strategies, Indexes, Emerging marketsGFIA says that most of the Asia Pacific managers it tracks generated substantial returns above the relevant index in May 2014. The long-biased firms did best there, their event-driven peers … not so much. Read More