Much talk today of a(nother) reversal in the fortunes of the short financials/long commodities position - the trade that lined the hedge fund coffers then sent them reeling come July (a la Harbinger).
The S&P financial index fell 1.1 per cent yesterday while commodities are heading for their biggest weekly gain in 33 years.
Basic MACD charts of crude and the S&P financial index show definite bullish and bearish signs emerging around Aug. 20 and Aug. 15, respectively:
Time to revive the trade? Those who resisted unwinding their positions in the midst of what some were calling a suckers’ rally may already be laughing all the way to the bank(s). Or not, ahem.
And coming later on FT Alphaville: Hedge fund failure Friday.
Update: Hedge fund failure Friday will now be hedge fund failure Tuesday.
Further reading:
Financials down but oil soars in volatile trading - FT
