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Tag: hedge funds

Szn 4, Ep 4: The Case for the Turkish Lira, With Dave Fishwick, M&G Investments

Published February 3, 2022

Dave Fishwick joins the podcast to make the argument for investing in the Turkish lira after it dropped half its value versus major currencies.

The appeal is not just the value but the carry, resulting in the equivalent of 30% to 40% annual interest income. To Fishwick and his team, the trade is not only contrarian but an example of the type of idiosyncratic idea that has no correlation to other parts of the portfolio.

The conversation is not limited to Turkey but expands to the U.S., China, and other emerging markets during the second half of the episode.

(This podcast was recorded in person at the iConnections conference in Miami. The acoustics were not ideal and there is some background noise as a result. Apologies for the inconvenience.)

Content Highlights

  • The macroeconomic policy experiment in Turkey, where the country’s central bank took the highly unorthodox step of combating a sovereign crisis by reducing interest rates. The Turkish lira went into freefall as a result (2:24);
  • The lira looks attractive on a real basis, but the real appeal comes in the so-called carry, an often-forgotten part of foreign exchange markets. How this works (3:29);
  • Some background on the strategy by the Central Bank of the Republic of Turkey, which is on the surface frightening. But therein lies the appeal (5:22);
  • Why buy the Turkish lira when the CBRT is cutting rates while the Fed is raising rates? (11:07);
  • If the CBRT succeeds with this experiment, could other emerging market countries follow its example? The strategy is not unprecedented… (13:15);
  • Background on the guest (16:19);
  • Fishwick’s view on current markets. The market has re-rated asset classes, despite upbeat economic news (18:43);
  • The present situation may appear bizarre, but it not without parallel. Why it’s hard to be bearish for the longer-term (21:48);
  • Other areas of the world that are interesting for investors, especially contrarians (24:11);
  • There are “some similarities” with what happened the last time the Fed entered on a sustained interest hiking campaign (2004 to 2007), but many differences. The key? Watch the inflation data, though the Fed’s record on engineering soft landings is poor (27:05).
MoreSzn 4, Ep 4: The Case for the Turkish Lira, With Dave Fishwick, M&G Investments
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Szn 3, Ep. 29: Causes for Optimism in 2022, with Ryan Worch

Published December 21, 2021

Ryan Worch of Worch Capital rejoins the podcast to provide his outlook on stocks for 2022. Spoiler alert: He’s bullish. With certain qualifications. Worch mentions specific securities in the latter half of the episode.

Nothing here is intended as investment advice.

Content Highlights

  • Worch’s contrarian call: We’re still in a secular bull market (4:14);
  • Underneath the surface there has been “some very real destruction in the speculative part of the markets.” Why this is happening (6:05);
  • Is there any hopes for the Cathie Wood names, meme stocks, cryptos, and NFTs? (9:25);
  • Many people are bearish. Too many (15:33);
  • How Worch Capital is positioning its portfolio and some favorite names (20:45);
  • A brief discussion about inflation (28:09).
MoreSzn 3, Ep. 29: Causes for Optimism in 2022, with Ryan Worch
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Season 3, Episode 22: The Transformation of the Hedge Fund Industry (Updated)

Published September 28, 2021

With Dominique Mielle

(Updates with transcript below. To get the transcript earlier, sign up to become a premium subscriber and take advantage of this and other benefits).

Dominque Mielle joins the podcast to discuss the transformation of the hedge fund industry, as encapsulated in her book ‘Damsel in Distressed: My Life in the Golden Age of Hedge Funds.’

Mielle’s career in hedge funds spans three decades, a period of dramatic growth that has culminated with many investors today questioning whether it still makes sense to allocate to the asset class — to the extent that it can even be called an asset class.

The guest says hedge funds still have value in certain circumstances, but there are many forces working against them.

She also has some views on markets and even cryptos that are discussed in the back end of the episode.

Content Highlights

  • Her reasons for writing the book: very few women in hedge funds and the critical growth periods she observed in the industry (2:05);
  • So does the hedge fund industry have a future? (5:15);
  • What exactly has changed in the last 20+ years to make hedge funds less compelling? (8:02);
  • There is certainly less mystique around hedge funds, and the media now reports returns and other things regularly — something the host himself has been guilty of. How has that affected things? (13:54);
  • Okay, so what is the value proposition for hedge funds? (18:58);
  • Background on the guest (25:36);
  • What if a woman wrote a ‘Liar’s Poker’ of the hedge fund world? And why aren’t there more women in finance? (31:30);
  • The guest’s view of markets at present. Tapering is critical (40:23);
  • Her views on cryptocurrencies (44:47).

More Information on the Guest:

Quick Highlights From Our YouTube Channel

Not intended as investment advice.

MoreSeason 3, Episode 22: The Transformation of the Hedge Fund Industry (Updated)
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