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"The Best Is Behind Us": How A $139 Billion Fund Is Preparing For The Worst

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Posted by ZeroHedge

on Monday, 16 July 2018 06:35

While equities continue to take the risk of escalating trade wars in stride, ignoring the threat of an additional $200BN in tariffs on Chinese exports and pushing the S&P back above 2800, some investors are taking a far more cautious approach: instead of piling into tech names - the most popular trade of 2018 bar none - Australian investment manager AMP Capital Investors, which manages $139BN, is instead buying ultra-long bonds as a hedge for a worst case scenario, according to Ilan Dekell, the head of macro for global fixed income at the asset manager.

"Six weeks ago, we started increasing our duration in the 30-year part of the curve,” Dekell told Bloomberg in an interview in Sydney.  “It gives us a bit of protection. I can’t forecast the trade war." 

Doing the opposite of Horseman Capital, AMP Capital is also betting on continued dollar strength by shorting a basket of emerging-market currencies which have been pounded in recent months amid tightening global liquidity.

bonds EM

 

....read more HERE


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