The resurrection of the short yen

Posted on 24. Feb, 2012 by Riskelia in Weekly Focus

As a result of central banks’ addictive monetary policies, moral hazard is at a peak and financial liquidity has become the main driver of financial markets. The latter is well-characterized by Riskelia’s indicator of risk aversion, which reflects the average dynamics of costs of risks across different asset classes (credit spreads, Ted spread, banks’ CDS, [...]

Liquidity is back… so is gold

Posted on 17. Feb, 2012 by Riskelia in Weekly Focus

Gold has come back to the forefront among the Radar recommendations. The correlation between gold and platinum has increased over time to a correlation approaching 0.8, but interestingly, gold is the commodity which is the least related to S&P 500, even if its correlation to the index has risen back in positive territory in the [...]

Are emerging markets re-emerging?

Posted on 09. Feb, 2012 by Riskelia in Weekly Focus

As global liquidity has consistently improved since the start of the year 2012, the emerging markets recovery is overwhelming. As showed in figure 1, the leader is emerging bonds which exhibited a positive trend during the whole 2011 financial crisis. This leader has been caught up by emerging equities and more recently by emerging currencies.

As [...]