About

Ahead of the Curve provides analysis and insight into today's global financial markets. The latest news and views from global stock, bond, commodity, and FOREX markets are discussed. Rajveer Rawlin is a PhD and received his MBA in finance from the Cardiff Metropolitan University, Wales, UK. He is an avid market watcher, having followed capital markets in the US and India since 1993. His research interests include capital markets, banking, investment analysis, and portfolio management, and he has over 20 years of experience in the above areas, covering the US and Indian markets. He has several publications in the above areas. He currently teaches business and management students at CHRIST University. The views expressed here are his own and should not be construed as advice to buy or sell securities.

Showing posts with label margin debt. Show all posts

Wednesday, 4 October 2017

Emerging Parallels to the Fall of 2007 - Hallmark of a Brand New Crisis

The fall of 2017 is increasingly looking like the fall of 2007 when risky assets topped out:

View the story "Emerging Parallels to the Fall of 2007 - Hallmark of a Brand New Crisis" on Storify

Monday, 8 May 2017

The Case for a Sell in May and Go Away

Monday, 18 April 2016

Chart of the Day - Investor Credit

The chart of the day is from Advisorperspectives and it shows that Margin debt in investor accounts continues to be at alarming levels and has eclipsed levels seen prior to market melt downs in 2000 and 2008. Is history about to repeat itself again?

Friday, 26 June 2015

Early Signs of a Deflationary Collapse?

Some interesting developments are playing out in long term charts that make me feel comprehensively bearish over the long term:

a) Firstly a massive rising wedge has formed on the long term S and P 500 chart. This is much bigger than that observed in 2000 or 2008 and has started to break to the downside which could have profound consequences. A major bear market could ensue post the break. Chart courtesy StockTwits.com:

b) Secondly Margin Debt is at record levels and has eclipsed levels seen during the maniacal peaks of 2000 and 2008. Once the above rising wedge breaks you could have a rush for the exit triggered by margin calls. Chart courtesy advisorperspectives.com:

c) Thirdly despite multiple dosages of Quantitative easing (#QE) from global central banks the velocity of money is below the levels observed during the Great Depression. This implies that changes in money supply will have little impact on the economy going forward. Further QE's are likely but won't really stimulate the global economy. Chart source armstrongeconomics.com.
velocity 1910-2010

The above developments taken together with ongoing bear markets in several key asset classes make for a deflationary collapse increasingly likely in the not too distant future.

Why I am Ultra Bearish Long Term from Rajveer Rawlin

Deflationary collapse up coming? http://t.co/wiJoi1PQfi pic.twitter.com/Z7otAmPEF5
— samuelR (@RajveerRawlin) September 7, 2015

My Asset Allocation Strategy (Indian Market)

Cash - 40%
Bonds - 20%
Fixed deposit - 20%
Gold - 5%
Stocks - 10% ( Majority of this in dividend funds)
Other Asset Classes - 5%

My belief is that stocks are relatively overvalued compared to bonds and attractive buying opportunities can come along after 1-2 years. In a deflationary scenario no asset class does well other than U.S bonds, the U.S dollar and the Japanese yen, so better to be safe than sorry with high quality government bonds and fixed deposits. Cash is the king always. Of course this varies with the person's age.