BUSINESS
Election predictions are too noisy to tell if Harris or Trump wins
Expert forecasters and betting markets offer useful information but have too many well-known systematic errors to be taken at face value
BUSINESS
Banning futures contracts on elections outcomes is shortsighted
Ballot outcomes have serious financial implications. Markets should be allowed to gauge whether futures contracts offer effective protection
BUSINESS
The long, slow decline in fund manager fees may be ending
A small and secretive corner of the exchange-traded fund business may be key to reversing the fortunes of traditional asset managers
BUSINESS
Crypto can turn pro with a little help from Congress
Legislation proposed by Congressman Patrick McHenry that would create a regulatory framework for the industry is sorely needed, whatever its final shape
BUSINESS
ChatGPT may rival Flash Boys in transforming markets
A plausible near-future story is large language model-flavored trading models will build large cross-asset-class portfolios similar to what global macro hedge funds do, but with more leverage, more positions, more active trading and no human to explain the thesis
BUSINESS
How a professional risk manager views threats posed by AI
The fact that individual AI routines today lack the sophistication and power necessary to destroy humanity, and mostly have benign goals, is no reason to think emergent AI intelligence will be nicer than people are
BUSINESS
SEC’s new hedge fund rules lack an accountant’s precision
The reporting requirements for short-sale transactions by big investors won’t help the agency uncover manipulative investing practices or potential blow-ups
BUSINESS
Dalio’s Shakespearean turn is a sign of the times
Dalio is typical of 20th century hedge fund founders in that he took on all three tasks personally -- he managed the trading, pitched investors and structured operations
BUSINESS
Widening wealth and inequality gaps have limits
A new staff report from the New York Fed makes an old argument for centrally managed capital, but its predictions will rarely hold up in the real world
BUSINESS
Summer’s end is ushering in a recessionary chill in the US
Gross Domestic Income, which was buoyant in 2022, has recorded two successive negative quarters now. GDI is now an all-time-high $379 billion less than GDP on an annualised basis. This is concerning because GDI is the more reliable recession predictor than GDP
BUSINESS
Corporate failure is a valuable asset that’s hard to protect
How do you value and protect know-how about unsuccessful products and experiments at a time of heightened employee mobility? It’s an increasingly important question for investors to consider
BUSINESS
Stock Forecasts: Reading between the lines of Morgan Stanley’s mea culpa
Morgan Stanley's star analyst Michael Wilson says the 2023 rally that proved his team wrong was driven almost exclusively by valuation. In plain words, he got the poor economic fundamentals right, but foolish investors pushed up stock prices anyway. He still thinks stocks will fall when investors come to their senses and realize he was really right all along
BUSINESS
A crypto truce emerges between fraud and revolution
Innovators and regulators may still not agree completely but there’s more common ground now than a few years ago
BUSINESS
Nobel laureate Harry Markowitz was a misunderstood economist
While his Modern Portfolio Theory forced a fundamental change in the assumptions of investing, its central insight remains theoretical.
BUSINESS
The stock market has momentum - maybe too much
Technical indicators such as the Relative Strength Index often exert outsized influence over investors at times when caution is warranted
BUSINESS
The gig economy comes for hedge funds
Platforms that offer money managers the freedom to build a business and maximise their return on performance while removing the hurdles of launching independently could change financial markets
BUSINESS
Markets acting odd? Round up the usual suspects
Quant funds take a lot of unwarranted blame whenever volatility soars or seems unusually low
BUSINESS
SEC's hedge fund rule fails to solve two main problems
The agency wants to be made aware of “trigger” events that might indicate financial stress within 72 hours, but it has neither the tools nor the staff for rapid market intervention
BUSINESS
TINA is still the only Wall Street acronym that matters
Are you with TINA or TARA? That’s a trick question. By shunning stocks when their prospects seem poor and alternatives seem enticing, you will miss more rallies than crashes
BUSINESS
Treasury bill rates at 5% are no bargain
The safest investment in the world is paying more than anytime since 2007. But you’re still going to lose money unless there’s a historic slowdown in inflation
