To The Moon

Myself and others have highlighted how European Equities have been breaking out to new all-time highs on the back of bullish factors such as cheap valuations, monetary tailwinds, improving (geo)politics, reforms, and so-on.But not many have noted the similar bull market underway in European credit markets.Much like what I observed with US credit spreads, European High Yield Credit Spreads have been steadily narrowing and making new lows. The point of contrast would be that Europe hasn’t quite revisited the pre-08 lows like the US has, but it sure is on a trajectory to get there — and is very clearly already at the bottom end of the range.On face value this is a positive sign, it means credit investors are confident on the state of things, and are happy to take on credit risk. At the same t

It’s not just the USA and Europe, EM corporate credit spreads are pushing lower as a warm blanket of complacency is wrapped around markets. The upside is that it likely does reflect an element of improved fundamentals given relative calm in macro and markets and improving data out of China. Furthermore, again — this can become self-reinforcing in that it reflects easier financial conditions, supporting growth and risk-taking, which in turn imparts a cyclical improvement in fundamentals.But the problem is it represents a very low risk premium for investors should things deteriorate. On my analysis I’d prefer EM sovereign bonds (ex-China), and EM equities where the risk premium is much larger and the upside potential asymmetric (but in the right direction… whereas corporate bond returns are

Overall equity positioning remains elevated despite the recent selloff (86th percentile vs history).No major outflows to be seen yet. $SPDR S&P 500 ETF Trust(SPY)$ $Invesco QQQ(QQQ)$ $iShares Russell 2000 ETF(IWM)$ ImageMarket psychology is always fascinating to look back on.Retail euphoria came right at the 2022 $S&P 500(.SPX)$ top.Retail despair/capitulation selling came 1 week before the 2022 SPX Bear Market lows. Psychology in the markets is a real thing $NVIDIA(NVDA)$ earnings will be the the answer to whether the market corrects or whether this was a dip buying oppor

Selling covered call options (sell covered call) is a strategy adopted by many large funds. It can also be used by retail investors in the US stock market.You can get income while holding it. This strategy is very suitable for stocks that have long-term positions, but they have not moved but they are not in a bearish position recently or are in a bearish position recently. It can be a good strategy for mature investors to roll over when holding some targets for a long time. Income comparison Assume that investors hold 200 shares of Amazon from January 1 to December 17, 2021 If there is no operation during the holding period, the final total assets will be USD 675,484 If the covered call strategy is carried out, it will be operated once a week; if 100 shares are sold after the exercise, ano