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Daz
Posted: 05 March 2025 19:34:14(UTC)
#12

Joined: 12/02/2020(UTC)
Posts: 8
So guys, what are places that one could keep an eye on, for when these opportunities present themselves? Either before the event, or at least not too late in the day.

In both the examples i mentioned above, as soon as i heard about them, i was like "yes, that's a good bet", in both cases i was right. So i don't think you need to predict them, only recognize when they're happening and make a quick decision based on common sense and as much research as you want to do.

Any other forums or places where people hang out, discussing this? I guess it's tricky, people don't want to necessarily share, on the other hand maybe a consensus emerges from pooling ideas?

re: Trump / US .. i think they're making a generational mistake and the damage is irreparable. It's like a house, sure, you can stop doing any maintenance for a few years and you'll certainly feel richer, but in the long run..... or in other words, it seems like the U.S. thinks it's only been give give give since 1941, without recognizing the benefits that have flowed back to them.
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ben ski
Posted: 05 March 2025 20:16:27(UTC)
#14

Joined: 15/01/2016(UTC)
Posts: 1,381

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It's basically 'global macro' trading. Investing around things that affect the broader economy: rates, inflation, debt, conflict, policies, etc.

And some of the largest funds in the world do this – Bridgewater, famously. BlueCrest and Brevan Howard. Eisler Capital.

And the reason it's popular with very large funds is because you're betting on things that might play out over years – and when you're a very large fund, it takes a long time to reposition. So it's like driving a huge HGV around a race track – you've got a lot of time to think about each turn.

It's also gambling. All these macro events can bet on – who's going to be the next president? Is the dollar going to fall against the yen? And you can bet on these things directly, with Spread Bets, or indirectly, by taking positions on currencies, bond durations, specific stock sectors, etc.

Is it a good idea? Probably not – because you're playing a game against very large, very informed players, who understand the odds and how to use different financial tools to make asymmetric bets – where you're not just betting on binary outcomes plus costs (which is how gambling destroys capital). Brevan Howard have been using strategies like strangles – where you use a Put and a Call against an asset, to hopefully profit from its volatility. But it helps if you've studied finance at Yale or somewhere to get the grounding in how to value options strategies, etc.

The best book, for me, is probably Hedge Fund Market Wizards. I think it has Stan Druckenmiller, Michael Platt. Then all of Ray Dalio's books and essays. I think you can use macro to make intelligent asset allocation decisions – as CGT and PNL do. But the idea of simply guessing right and making higher returns, I think, is quite unrealistic.
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Daz on 05/03/2025(UTC)
ANDREW FOSTER
Posted: 05 March 2025 20:38:52(UTC)
#13

Joined: 23/07/2019(UTC)
Posts: 8,151
Daz;336623 wrote:
So guys, what are places that one could keep an eye on, for when these opportunities present themselves? Either before the event, or at least not too late in the day.

In both the examples i mentioned above, as soon as i heard about them, i was like "yes, that's a good bet", in both cases i was right. So i don't think you need to predict them, only recognize when they're happening and make a quick decision based on common sense and as much research as you want to do.



Devils advocate here then for a moment...

What did/do you think of "The Hydrogen Economy" ?

Or many other much vaunted projects like Full Level 5 Self Driving, Carbon Capture Technology, Battery Grid Storage for example...

All much hyped up, but with wide ranging degrees of success.

What are your criteria for judging such new tech?


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Johan De Silva
Posted: 05 March 2025 21:30:25(UTC)
#17

Joined: 22/07/2019(UTC)
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The European Défense trend was predictable and then accelerated over the weekend by events and on Monday woke up to double digit gains.

This was a predictable start of a new trend. Pretty easy.

The UK and Europe financial trend with higher rates seems to have also been a pretty simple one for me. Again rare as the market only partially factored it in.

The past year or so have been an exceptionally good time. What this forum fears is getting in late on FOMO and I suffer from it myself but you have to think in terms of risk adjusted return and have some idea of valuations.

At the end of the day it was luck, guts and speed and if you look at valuations the Financials Sector will likely do much better than tech and the wider index in my opinion especially if you go looking into unloved regions and index's. Companies like ALPH are swimming in cash and are under 15 times free cash flow. I have friends still on 3x leverage European Banks via 3BAL coining it in.
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Sheerman on 06/03/2025(UTC)
Rookie Investor
Posted: 05 March 2025 21:36:55(UTC)
#6

Joined: 09/12/2020(UTC)
Posts: 2,095
ANDREW FOSTER;336601 wrote:
Rookie Investor;336582 wrote:
Raj K;336579 wrote:
Noise investing! That's what i call it.

Seems a lot of traffic here on these forums discussing Trump and his antics.

I just ignore most of it. Clutters the mind, causes too much trading!





Yeh seems some like to make bold statements about this or that will happen due to Trump, tariffs etc. It really is a bad way of thinking if one is investing, because it is coming up with extreme definitive conclusions, when the world and these sorts of news is a lot more complicated and nuanced than that.

Just take a look at Andrew Foster's various posts over the years, in particular he had some very strong views on Meta in 2022 about the metaverse, when a decent enough investor would have looked into a bit more and saw that it was one of, if not the best opportunities to buy quality for cheap, for many years.

Unless you know for damned sure something will happen, there is no need to make drastic changes to one's portfolio. 99.9% of the time it never is 100% certain, so always have a balanced view and look out for opportunities, like Meta in 2022 which was IMO over 90% certainty of a good deal, but unfortunately I did not look into it.


I did have strong views on Meta...and it's Metaverse project

And I was correct! The Metaverse was a total, utter disaster that absorbed billions and was never going to work.

Of course things recovered after it was quietly abandoned..🤷🏼‍♂️ Meta makes a lot of cashflow.

There was, of course, no way to know when that would happen or how much money would be thrown into the money pit first.

The important thing to grasp is that when large macro events are on motion, a decision to stay put is as profound as a decision to switch out. We have access to the same facts.



You were right and so was the market - because the stock tanked given the reckless spending. There is no great insight or skill from you for recognising this.

The skill and ability comes from recognising that Meta, at the time, was getting absurdly cheap, pricing in the reckless spending (and then some) - which crucially can easily be reversed particularly given the market was telling them to.

And this is not me picking on you in anyway, but you make a very good example of how NOT to think in in terms of investing. You threw out Meta as investible simply because of surface level view on the metaverse. When it was quite easily the best opportunity in the market for many years.

So when you and others look at the headlines, about trump doing this or that or other such things, then take some strong, black/white view, without nuance or balance, it really is a terrible way to think when it comes to investing with real money. And looking at macro is perhaps the worse thing to do if you are betting on this or that.
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ben ski
Posted: 05 March 2025 21:49:45(UTC)
#18

Joined: 15/01/2016(UTC)
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Johan De Silva;336630 wrote:
At the end of the day it was luck, guts and speed and if you look at valuations the Financials Sector will likely do much better than tech and the wider index in my opinion especially if you go looking into unloved regions and index's. Companies like ALPH are swimming in cash and are under 15 times free cash flow. I have friends still on 3x leverage European Banks via 3BAL coining it in.


The problem of course with cyclicals, like banks, is their cashflows change when rates do. So banks are doing really well at the moment due to Net Interest Margin and inflation (nominal GDP, more borrowing, etc.). And they don't want either to go down, necessarily.
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Johan De Silva on 05/03/2025(UTC)
ben ski
Posted: 05 March 2025 21:53:53(UTC)
#19

Joined: 15/01/2016(UTC)
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I'm neither right nor left, but I thought Trump's state of the union address yesterday was superb.

I even thought about more direct US investment – I'm normally FTSE World – just because you've got a country being run like a business, while most others are mired in politics and bureaucracy. I think the US comes out of this in a much better position.
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Johan De Silva on 05/03/2025(UTC)
Johan De Silva
Posted: 05 March 2025 22:18:02(UTC)
#23

Joined: 22/07/2019(UTC)
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Ben I agree with both your points above and I am waiting for discounts on US Trusts like JAM to widen and they have demonstrated an ability to pivot between sectors in the past. Tarrifs negotiations could however be over faster than I think.
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ben ski on 06/03/2025(UTC)
ANDREW FOSTER
Posted: 05 March 2025 22:36:34(UTC)
#25

Joined: 23/07/2019(UTC)
Posts: 8,151
Johan De Silva;336639 wrote:
Ben I agree with both your points above and I am waiting for discounts on US Trusts like JAM to widen and they have demonstrated an ability to pivot between sectors in the past. Tarrifs negotiations could however be over faster than I think.


Are there any negotiations going on with regard to tariffs. I haven't heard of any...?

I read that Canada has filed a complaint with the WTO over the violation of the North America free trade agreements....

But it sounds like the "oh shit" has started already and America is backpeddling.

https://www.theguardian....mp-tariffs-canada-mexico
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Johan De Silva on 06/03/2025(UTC)
Newbie
Posted: 05 March 2025 22:36:36(UTC)
#24

Joined: 31/01/2012(UTC)
Posts: 3,828
Johan De Silva;336639 wrote:
Ben I agree with both your points above and I am waiting for discounts on US Trusts like JAM to widen and they have demonstrated an ability to pivot between sectors in the past. Tarrifs negotiations could however be over faster than I think.

JAM and discounts - not really a combination that is witnessed often
My experience has been that it is an excellently managed trust - 80:20 split with effective controls.
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