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Quant fund chief Jason Hsu thought Nvidia's rally couldn't last any longer – so talked his mom into selling at $250 a share. "I'm going to be putting a hex curse on that stock," Hsu joked. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . AdvertisementAdvertisementThe head of a quant trading fund told his mom to sell her Nvidia shares when they were trading at just 60% of their current price – and hasn't heard the end of it since. "I told my mom, 'Sell Nvidia, you made such a good gain.'
Persons: Jason Hsu, Nvidia's, Hsu, , hasn't, he'd, Rayliant Organizations: Service, Nvidia, Rayliant Global Advisors, Research
SHANGHAI/SINGAPORE, Sept 26 (Reuters) - China's securities regulators have told market participants that tighter rules for programme trading were not designed to kill the business, but were a response to calls for more oversight, according Asia's largest financial lobby group ASIFMA. "There's no intent to be prejudiced against high frequency trading firms," said Lyndon Chao, ASIFMA managing director and head of equities and post trade. Quant funds in China include global players such as Winton, Two Sigma and D.E.Shaw though these three aren't members of ASIFMA. The rules "came out all of a sudden because the regulators might be facing pressure from investors suffering from recent poor stock market performance," he said. There are a lot of quant funds out there that do a great job of injecting liquidity when needed.
Persons: Lyndon Chao, They're, ASIFMA, Chao, Ren Zeping, Liu Yuhui, ASIFMA's Chao, Samuel Shen, Jason Xue, Tom Westbrook, Shri Navaratnam Organizations: Sigma, Reuters, Thomson Locations: SHANGHAI, SINGAPORE, China, Winton, Shanghai, Shenzhen
A man wearing a protective mask is seen inside the Shanghai Stock Exchange building, as the country is hit by a new coronavirus outbreak, at the Pudong financial district in Shanghai, China February 28, 2020. Separately, the Shanghai and Shenzhen stock exchanges, under the CSRC's guidance, have sought information from major quant funds on their money-making strategies, another source said. The weakness has triggered finger-pointing in social media, as well as criticism from fund managers and retail investors against these quant funds and short sellers. Short-selling activities by quant funds could also be caught in the crossfire, he said. Another brokerage source said the CSRC asked them to elaborate on the size of their quant clientele and whether quant trading had impacted recent stock market.
Persons: Aly, shortsellers, Yuan Yuwei, Yang Tingwu, Shri Navaratnam Organizations: Shanghai Stock Exchange, REUTERS, Rights, China Securities Regulatory Commission, Global, Sigma, Huatai Securities, China's, Quant Investment, Yanfu Investments, Shanghai Minghong Investment Management Co, Wisdom Asset, Tongheng Investment, Shanghai, Thomson Locations: Pudong, Shanghai, China, Shenzhen, Winton, Beijing
Some believe a tight oil market and resilient U.S. growth will keep energy stocks rising for the rest of 2023. Bullish investors argue that energy stocks are still cheap by historical standards - and far less richly valued than other areas of the market. The energy sector currently trades at a forward price to earnings ratio of 12.2, well below its historical median forward P/E of 15.3, according to LSEG Datastream. Parts of the market appear skeptical energy stocks have much further to run. "That should result in a ... smoother ride for energy stocks than we’ve been accustomed to."
Persons: Bing Guan, LSEG, Charles Lemonides, Baker Hughes, Savita Subramanian, Brent, Bjarne Schieldrop, Rodney Clayton, we’ve, David Randall, Ira Iosebashvili, Marguerita Choy Organizations: Exxon, Mobil, REUTERS, Energy, West Texas, Federal, drillers, U.S . Energy, Administration, Global, Citi, Brent, SEB Research, Macquarie, Duff, Phelps Investment Management, Thomson Locations: Beaumont , Texas, U.S, Saudi Arabia, Russia, China
China is scrutinizing hedge funds betting against its struggling economy, according to Reuters. Beijing has put the squeeze on brokerages that use quantitative strategies to short-sell the market, the outlet reported. Get the inside scoop on today’s biggest stories in business, from Wall Street to Silicon Valley — delivered daily. That's dragged down Chinese stocks this year, with the flagship CSI 300 index down 5% and Hong Kong's Hang Seng index slumping 11% so far in 2023. As well as pushing back against these trading strategies, policymakers halved the stamp duty that investors are required to pay when trading stocks last month in a bid to revive China's stagnant markets.
Persons: That's Organizations: Reuters, CSI, Service, country's Securities, Commission, Financial Times Locations: China, Beijing, Wall, Silicon
Bank of America's Savita Subramanian raised her 2023 year-end S & P 500 price target to 4,600, saying the rally will broaden out from here. The equity and quant strategist increased her S & P 500 target to 4,600 from 4,300 — placing it among the higher forecasts in CNBC's Market Strategist survey . The strategist expects even better returns for the average stock over the S & P 500, which is weighed by market value, as the rally broadens. Her bear case is 4,100 and bull case is 4,700 for the S & P 500. All three major averages are negative on the month, and the S & P 500 and Nasdaq Composite are lower this quarter.
Persons: America's Savita Subramanian, Subramanian, — CNBC's Michael Bloom Organizations: America's, Nasdaq, Tech
Brown had the idea for IBM's "Deep Blue," and has spent over 2,000 nights sleeping in his office. RenTech was founded by Jim Simons, a former MIT math professor and Cold War codebreaker. Peter Brown is the CEO of Renaissance Technologies, a quant fund founded by former Cold War codebreaker and MIT math professor Jim Simons. And the job is so demanding, I really don't see how I could do it otherwise." We don't know any economics.
Persons: Peter Brown, Brown, RenTech, Jim Simons, Goldman, he's, he'd, Peter, we're, we've Organizations: Renaissance, MIT, Service, Goldman Sachs Exchanges, Renaissance Technologies Locations: Wall, Silicon, York
Next, Swinkels likes developed market equities, which include stocks in countries like France, Germany, the UK, Australia, Japan, and more. The iShares MSCI EAFE ETF (EFA) offers exposure to developed market stocks outside of the US and Canada. Exchange-traded funds like the Schwab Emerging Markets Equity ETF (SCHE) or the Vanguard FTSE Emerging Markets ETF (VWO) are one way to invest in emerging market stocks. "The CAPE ratio of global real estate is currently 13.3, well below its average of 19.4 since 2000," Swinkels said. One way to invest in real estate without buying properties directly is through real-estate investment trusts, also known as REITs.
Persons: Laurens Swinkels, Peter van der, Swinkels, we've Organizations: Federal, iShares, Yield Corp, Exchange, Schwab, Equity, Vanguard FTSE, Markets, Simon Property Group Locations: France, Germany, Australia, Japan, Canada, China, Brazil, India, Saudi Arabia
Although valuation matters in the long-run, sentiment has a more immediate impact on share prices, Carey Hall wrote. Carey Hall noted that "based on the equal weighted S&P 500, PE ratios are roughly at historical average levels." Bank of AmericaThe reason for this is investor pessimism, particularly when it comes to long-term growth (LTG) expectations. "Today's LTG suggests >25% price returns over the next 12 months for the S&P 500, all else equal." According to Carey Hall, the best investment opportunities lie in the interactive media & services, household durables, media, passenger airlines, energy equipment & services, and insurance industries.
Persons: , Jill Carey, Carey Hall, Carey, LTG Organizations: Bank of America, Carey Hall Locations: LTG
Small and mid-cap stocks transforming their businesses can create great investment opportunities. Bank of America's Jill Carey Hall found 14 stocks making changes that the market hasn't noticed yet. Bank of America equity & quant strategist Jill Carey Hall knows this is particularly true for small and mid-cap (SMID-cap) stocks. As Carey Hall pointed out in a recent note to clients, that's exactly what many SMID-cap stocks are doing right now. The 14 stocks the BofA analysts chose are below, along with their tickers, sectors, market caps, price objectives, and upsides to those objectives.
Persons: Bank of America's Jill Carey Hall, Jill Carey, Carey, Carey Hall Organizations: Bank of America's, Bank of America
There's a lot that could go wrong in the stock market that investors are not fully appreciating. That's according to JPMorgan's quant chief, Marko Kolanovic, who is worried about high interest rates. "We think there is now a higher likelihood of a crisis over the next six to 12 months," he said. For Kolanovic to turn more bullish on the stock market, he needs to see two things — and they have nothing to do with the promise of AI. Instead, he wants to see interest rates fall around the world, as well as a de-escalation of geopolitical tensions in Russia and China.
Persons: JPMorgan's, Marko Kolanovic, JPMorgan's Marko Kolanovic, Kolanovic Organizations: Service Locations: Wall, Silicon, Ukraine, Russia, China
Alex Gerko's wealth is now estimated at $10.8 billion as his firm XTX has become a top global player. He is now number 182 on the Bloomberg Billionaires Index, which just calculated that his fortune doubled. The index added $5 billion to his wealth compared to the prior trading day. While revenue still trails Citadel Securities' $7.5 billion in 2022, XTX is emerging as one of the top players in global markets. The firm handles a trading volume of around $300 billion a day, involved in equities, commodities, currencies, and fixed-income.
Persons: Alex Gerko's, XTX, Alex Gerko, Stanley Druckenmiller's, Gerko — Organizations: Bloomberg, Service, Deutsche Bank, XTX, Citadel Securities, Financial Times Locations: Wall, Silicon, Russian
A Two Sigma chief investment officer has taken a medical leave, Insider has learned. The firm announced the leave of Alex Ginsburg, CIO of equities, to investors and employees in July. A senior Two Sigma investment executive has taken a leave of absence from the firm, Insider has learned. Two Sigma chief data strategist Ali-Milan Nekmouche, who has been with the company since 2004, has been named as Ginsburg's replacement. Siegel did not leave the firm and the group ended up staying at Two Sigma, the Journal reported.
Persons: Alex Ginsburg, Jeff Penney, Timothy Reynolds, Ali, Milan Nekmouche, Ginsburg's, David Siegel, John Overdeck, Siegel, Overdeck, Ginsburg, Geoffrey Duncombe, Alex Morrell, Rebecca Ungarino Organizations: Sigma, Street Locations: amorrell
Small and mid-cap stocks are providing cash-flow opportunities, according to Bank of America. If you're looking for cash in the form of buybacks and dividends, small and mid-cap stocks may be a good bet, according to a Bank of America note from August 14. Earlier this year, the bank warned investors to remain discerning when it comes to buying in small-cap stocks. When an economy is on the mend, small-cap value stocks tend to rally ahead, leading the recovery by outperforming their larger counterparts over multiple years, according to David Wagner, portfolio manager for the SmallCap Value Fund at T. Rowe Price (PRSVX). Earlier in August, Bank of America held a virtual conference with executives from 20 small and mid-cap companies.
Persons: David Wagner, Rowe Price, Jill Carey Hall Organizations: Bank of America, Bank, America
He came up with a quantitative system that filters for growing and cash-generating companies. These 30 stocks are considered the most undervalued bets based on Risenhoover's methodology. In 2014, he turned to Dr. Wesley Gray, CEO and CIO of the asset-management firm Alpha Architect, to backtest the model. At the time, Gray had just co-authored a book on quantitative value investing that informed much of Risenhoover's thinking. Risenhoover recommends reviewing the stock's chart and its price action to decide whether you're comfortable with it.
Persons: Wilton Risenhoover, Risenhoover, Wesley Gray, Gray, Russell, Stocks, that's, I've Organizations: University of California, Alpha Locations: Los Angeles
Some Wall Street analysts are sounding the alarm for a coming sell-off in stocks. That comes as the S&P 500 enjoys its best year since 1927, gaining 18% from January. Get the inside scoop on today’s biggest stories in business, from Wall Street to Silicon Valley — delivered daily. That comes as the S&P 500 enjoys one of its best years since 1927, largely thanks to Wall Street's excitement for artificial intelligence. But he sees the overall S&P 500 ending the year at 4,600-4,800, above current levels.
Persons: Eduardo Munoz JPMorgan, JPMorgan's Marko Kolanovic, Shannon Stapleton Wells, Scott Wren, Wren, Brendan McDermid, Rosenberg, David Rosenberg Organizations: Service, REUTERS, Reuters BlackRock, Rosenberg Research, Dow Locations: Wall, Silicon
Evercore ISI's Julian Emanuel says it's time to buy "sector neutral" stocks with earnings momentum but lagging price momentum. Names with earnings momentum Emanuel told CNBC on Tuesday that there's a group of stocks whose earnings momentum is "superior to peers." "We recommend remaining fully invested, shifting focus to a sector neutral quant screen of stocks whose EPS momentum is better than peers yet whose price momentum lags since the March inflection to Maximum Momentum," he wrote in a July 23 note. "Such 'Earnings Mo' to Price Mo'" stocks could be expected to outperform as price momentum leaders 'cool off,'" he wrote. But he said that the long-term story is "exceptionally robust," thanks to an expected "productivity boost" from China.
Persons: Evercore, Julian Emanuel, Emanuel, Price Mo, CNBC's Organizations: CNBC, Deere & Co Energy, Cheniere Energy, Alnylam Pharmaceuticals Communication, Pinterest, Eversource Locations: China
The second-quarter earnings season is in full swing, and this is the busiest week of the season. Bank of America has found the 9 stocks most likely to beat earnings expectations in the coming days. Wall Street was ready for a tough first-quarter earnings season, with expectations low across the board. 9 stocks expected to beat earnings estimatesBank of America analysts screened for the stocks they think are most likely to beat analyst estimates this earnings season, using the following criteria. The resulting nine stocks below are the best bets for beating expectations this earnings season.
Persons: Oshung Kwon, Kwon, it's Organizations: Bank of America, Bank of, Industrials, of America
Drew Angerer | Getty Images News | Getty ImagesCentral banks are at "the end of the beginning" in their battle against inflation, as several factors keep core prices persistently high, according to top Societe Generale economist Kokou Agbo-Bloua. U.S. inflation cooled in May to an annual 4%, its lowest annual rate in more than two years, but core inflation rose by 0.4% month-on-month and 5.3% year-on-year. In assessing the current state of global policymakers' efforts to tame inflation, Agbo-Bloua quoted former British Prime Minister Winston Churchill's remarks in a 1942 speech: "Now this is not the end. It is not even the beginning of the end. He suggested that this has helped to keep the labor market resilient, which will likely extend this lag time.
Persons: Jerome Powell, Drew Angerer, Kokou Agbo, Bloua, Winston Churchill's, we're Organizations: Federal Reserve, Federal, Market, Getty, Societe Generale, British, CNBC Locations: Washington ,, Ukraine, Agbo
Both David Rosenberg and Rob Arnott see big disruption coming for the labor market. AI stocks are also overextended amid the current mania, they said. Rob Arnott says AI will evolve rapidly and upend the labor market. He added: "The implications of generative AI on the labor market will be one of upheaval and one of escalating job uncertainty." Beware of an AI-stock bubbleFor Arnott, AI will undoubtedly be good for bottom lines.
Persons: David Rosenberg, Rob Arnott, Rosenberg, Arnott, Tim Boyle, aren't, Merrill Lynch, it's, Tesla, that's, Gluskin Sheff Rosenberg Organizations: Labor, Research, Bloomberg, Getty, North, Rosenberg Research Locations: North American, ChatGPT
The yield curve's inversions deepened in June after Fed Chair Jerome Powell indicated that the central bank would likely raise rates two more times this year. Stronger-than-expected economic data on Thursday backed expectations that the Fed will keep interest rates higher for longer. Treasury yields- which move inversely to prices - moved up, with 10-year and two-year yields hitting their highest since March 10 and 9, respectively, while some curve inversions intensified. The spread between one- and 30-year Treasury yields was as wide as 153 basis points on Wednesday, its biggest gap since 1981. Key areas of the U.S. economy, including housing and labor, have proven resilient despite higher rates.
Persons: Jerome Powell, Powell, Janet Rilling, Huw Roberts, Davide Barbuscia, Chuck Mikolajczak, Ira Iosebashvili, Sam Holmes, Aurora Ellis, Nick Zieminski Organizations: YORK, U.S, Treasury, Federal, Allspring Global Investments, Quant, Thomson Locations: U.S
Dollar index hits two-week high after data; yen remains soft
  + stars: | 2023-06-29 | by ( ) www.cnbc.com   time to read: +3 min
Hundred dollar bills are seen in this photo illustraiton in Warsaw, Poland on Sept. 21, 2022. The U.S. dollar index climbed to a two-week high on Thursday after economic data showed the labor market remained on a solid footing, giving the Federal Reserve a possible cushion to continue raising interest rates. He said he did not see inflation coming down to the Fed's 2% target until at least 2025. The dollar index was up 0.204% at 103.150 after earlier climbing to 103.44, its highest level since June 13. The dollar strengthened against the Japanese yen for a third straight day, hitting a fresh 7-1/2 month high of 144.90, as U.S. and Japanese central bank policy plans are expected to remain at opposite ends of the spectrum.
Persons: Jerome Powell, Raphael Bostic, Christine Lagarde, Andrew Bailey, Kazuo Ueda, Huw Roberts, Roberts, CME's Organizations: U.S, Federal Reserve, Reuters, Commerce Department, European Central Bank, Atlanta Federal Reserve, Bank of England, Bank of Japan, Fed Locations: Warsaw, Poland, Bank, Europe, Spain, Italy, Swedish
AI's impact on the job marketRob Arnott"Every important disruption since the start of the industrial revolution has cost millions of people jobs. Millions of jobs will be lost to those who know how to use AI. "The implications of generative AI on the labor market will be one of upheaval and one of escalating job uncertainty. Are AI stocks in a bubble? Rosenberg"Advancements in AI technology, and its knock-on effects on profitability and productivity, is a legitimate investment thesis.
Persons: David Rosenberg, Rob Arnott, Savita Subramanian, Cam Harvey, Jawad Mian, Jobs, Merrill Lynch, aren't, Rosenberg, Harvey, Arnott, Brad Cornell, Aswath, There's, that's, Savita, , capex, Mian Organizations: Industries, Investors, Research, Rosenberg Research, North, Bank of America Securities, Duke University, Microsoft, Nvidia, Google, Tech, Software, Services, Professional Services, IT Services Locations: North American, ChatGPT, Asia, Taiwan
Two Sigma, the successful quant hedge fund, is dogged by two cofounders who don't get along. Disagreements between Overdeck and Siegel only surfaced publicly for the first time last week. The disclosure was highly unusual for a hedge fund since they generally have much lighter disclosure requirements than their public counterparts, experts say, making the filing all the more notable. The firm has been known mainly as a premier quantitative hedge fund since its founding. Then when it comes to planning for the next generation of leaders to take over from hedge fund founders, the transition can be difficult.
Persons: John Overdeck, David Siegel, Overdeck, Siegel, Mark Pickard, Jonathan Hitchon, Sarah Jacobs, Kevin Mullally, Mullally Organizations: Sigma, Street Journal, Overdeck, Wall Street, Business, University of Central Locations: New York, Manhattan's SoHo, University of Central Florida
Bank of America has named the European companies whose stocks are expected to perform robustly in the face of a possible economic downturn. It comes amid increasing signs that the European economy could be headed for a period of extended recession. Bank of America's proprietary Style Cycle model also shows that the region is facing a "recession phase." The forward cash yield measures how much cash a company is expected to generate for its shareholders over the next year compared to its current market price. The cash yield also includes returns through buybacks.
Persons: Intesa Sanpaolo, Paulina Strzelinska Organizations: of America, of, KBC, Eni, Nordea Bank, Barclays, Aviva, BNP, Bank, America's Locations: Europe, Belgium, Italy, Finland, Repsol, Spain, United Kingdom, France, buybacks, industrials
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