Mon, Jul 28, 2014
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

The Big Picture: The stage is set for an emerging market crisis

Tuesday, September 10, 2013

amb
Benedicte Gravrand, Opalesque Geneva:

An Opalesque column for global macro investors.

The U.S. Fed recently announced a forthcoming tapering of QE, which coincided with money leaving emerging market (EM) investments. EM currencies have been battered, bond issues have lowered, and equities have lost value.

Vijai Mohan, founder of San Francisco-based Hyphen Fund Management LLC and portfolio manager of the fund Hyphen Partners L.P., a long/short equity hedge fund, told Opalesque at the end of last year that the fund was generally positioned along two lines; long developed markets and heavily short emerging markets. He believed an EM crisis was imminent.

Investors are pulling out of EM stock and bond markets for the first time in 9 years

How much closer are we to an emerging market crisis? According to Vijai Mohan, it has already started.

The four triggers for an EM crisis are, according to Mohan:

(1) A deterioration of the terms of trade of debtor countries (Deteriorated steadily since early 2009) (2) A recession in the core countries that were the providers of capital (Started with the 2011 Eurozone crisis) (3) A rise in international borrowing costs driven by events in creditor countries, such as tighter monetary policy (2013 Fed "Tapering") ......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing
  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Events – AIMA Australian Hedge Fund Forum, Sept. 16, Sydney[more]

    AIMA Australia invite you to join us at our annual Hedge Fund Forum on Tuesday 16th September 2014 at the Sofitel Sydney Wentworth. The AIMA Australian Hedge Fund Forum is a non-profit hedge fund conference organised by the industry for the industry, featuring quality Australian and internation

  2. Opalesque Roundtable: Success in hedge fund marketing not linked to performance, but investor appetite[more]

    Komfie Manalo, Opalesque Asia: Success in marketing a fund is not linked to the performance, but to investor appetite, to the way you can market the fund, and to how much time you can spend to raise assets, said Antoine Rolland, the CEO of incubator and seeding firm

  3. Opalesque Exclusive: Loeb, Grantham cite growing economic concerns in letters[more]

    Bailey McCann, Opalesque New York: Hedge fund manager Daniel Loeb, head of Third Point, and Jeremy Grantham of Grantham, Mayo, Van Otterloo & Co. have both released their quarterly investor letters today. While news is positive on some fronts, and both men see pockets of opportunity, they also h

  4. Investing – Hedge funds expect Netflix earnings to catapult forward, Third Point's Loeb takes stakes in Fibra Uno, YPF, Royal DSM, Lake Capital in talks to back Engine Group[more]

    Hedge funds expect Netflix earnings to catapult forward From Investing.com: Netflix has made major strides forward in 2014 despite ongoing battles with the FCC and cable companies over the issue of net neutrality. The FCC has now received over 500,000 comments from the public on its pend

  5. Hedge fund manager Winton Capital making headway with long-only strategy[more]

    From PIonline.com: North American investors are helping Winton Capital Management Ltd. make progress — albeit slowly — toward its founder's goal of becoming a $100 billion company. The firm's ticket to quadrupling its assets under management is unlikely to be one of its scientifically designed manag