Posted by: Tom Keene on September 8, 2010
Walk Back to the Dugout
Call it a strategic, chronic, persistent mistake. That would be the media’s guesstimate of how often investors/traders get it right. Summary: investing/trading/speculating is dramatically harder to do than the media and the public think. Saijel Kishan reports on John Paulson’s difficult 2010 search for alpha.
The basic idea is in 100 “trades” you are wrong about 70% of the time. You walk back to the dugout, often. Far less understood is of the 30 times you put the ball in play, you get a single, often. Thunderous reality: out of 100 trades, maybe 3 or 5 create most of your return.
John Paulson knows this. So should you.
Research (Ready, Set, Extrapolate!)
Thomas Stolper and the rest of the Goldman Sachs research team in London launch a Global Viewpoint. They see USD weakness on U.S. “decoupling” from above-consensus GDP views for the rest of the world. GS has the BRICs at 8% and the Advanced Economies at 2.4% for next year. Ready, Set, Extrapolate.
Win Thin at Brown Brothers Harriman suggests a “big mistake” by Hungary as they back away from IMF backing. The Bloomberg to the rescue: Here is CHF-HUF showing a near-58% depreciation of the forint to the Swiss franc. Thanks to Piotr Skolimowski on the Warsaw watch.
EURCHF CRNCY GP W ROLL
GIGB10YR INDEX GP Q ROLL: The Irish 10-Year Back to the 90s.
Taylor on Baum