A meltdown in world equity markets in recent days is more reflective of a wind-down of carry trades used by investors to juice their bets than a hard and fast shift in the U.S. economic outlook, analysts say.
“In our assessment a lot of this has been down to position capitulation as a number of macro funds have been caught the wrong way around on a trade, and stops have been triggered, initially starting with FX and the Japanese yen,” said Mark Dowding, chief investment officer at BlueBay Asset Management, referring to pre-determined levels that trigger buying or selling.
Bank for International Settlements data suggests cross-border yen borrowing has increased by $742 billion since the end of 2021, the bank noted. Banks give hedge funds leverage, essentially a loan to fund investing, which amplifies hedge fund returns but can also increase losses.
South Africa South Africa Latest News, South Africa South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: DCN_Canada - 🏆 17. / 74 Read more »
Source: globeandmail - 🏆 5. / 92 Read more »
Source: YahooFinanceCA - 🏆 47. / 63 Read more »