Most Recent
Gavekal-IS
A Fertile Macro Combination For Emerging Markets
Didier Darcet
18 Jul 2024
Equity market dynamics stem from millions of microeconomic interactions and decisions. Conversely, the valuation of different forms of money such as bills, bonds and gold is largely influenced by the decisions of a few key financial players—especially central bankers. For Didier, this means the “offensive” part of a portfolio (equities) should be managed in a different way than the defensive part (money).
Gavekal-IS
Who Wants Gold, And Why?
Didier Darcet
11 Jul 2024
About half of global demand for the metal comes from jewelers, while less than 7% is from industrial users. The rest relates to financial uses, whether bars and coins for private hoarding, central bank reserves or the backing for exchange traded funds used as highly liquid investments. But how do these different classes of owner react to events, asks Didier in this report.
More Research
China In A Disinflationary Boom
For months, the Gavekal-IS team has expected China to enter the disinflationary-boom segment of our four quadrants schematic and it finally happened on June 30. In this report, Didier explores what the transition means for equity investors.
The Revision Of Beliefs
What do debates about the Covid pandemic, the Russo-Ukrainian war and issues surrounding artificial intelligence and cryptocurrencies have in common? Didier says such discussion reflects the way that people are being forced to reassess their core beliefs in these turbulent times. In this piece, he looks at the investment implications of this cultural milieu.
Euro Sentiment
Frances’s parliamentary elections on July 7 could roil the French debt market and, in turn, the euro exchange rate. So, how to gauge market sentiment towards Europe’s single currency? And if this sentiment is sufficiently negative, which other currencies offer protection? In this week’s note, Didier seeks to answer these questions.
Non-Substitutable
In a capitalist system, an individual’s professional success—much like that of a product—is based on what economists call “comparative advantage”. At first glance, this might sound like ugly reductionism, yet it is vital for understanding one’s pricing power in any given market, says Didier.
Monetary Illusion
Modern marketing in our capitalist system implores us to “enjoy the moment” rather than squirrel money away to secure financial freedom down the track. For this reason, saving money is not the flashiest part of anyone’s life plan, but it is important. The issue for savers, contends Didier, is unpicking the difference between rises in prices and increases in value. That requires an understanding of inflation and the impact of monetary illusion.
Jim Simons: An Anomaly?
The recent passing of Jim Simons was a sad and poignant moment for Didier. The Renaissance Technologies founder was the best of the best, with his flagship Medallion fund achieving an average annual return of some 66% before fees, without incurring a single year of losses. In this report, Didier asks how this was even possible and how Simons’ approach to trading market anomalies can be applied in today’s more information-dense markets.