Wall Street is tired of getting political bets wrong. Fund managers and research analysts are parsing alternative data for gauging election probabilities after twists and turns in the recent U.S. voting sent asset prices swinging. That means looking at everything from betting markets to historical changes in voter registrations and sentiment on Twitter.
Wisdom accumulated over many decades is highly prized in most cultures. Less so for machine learning in investing, it would seem. Algorithms that use long histories of data to build their understanding of markets flopped during the Covid-19 pandemic. Such models failed “pretty spectacularly” in the extreme events of 2020, says Michael Heldmann, head of multi-factor equity investing for North America at Allianz Global Investors, citing research conducted by the firm.
The coronavirus pandemic and resulting economic conditions have presented a “once-in-a-decade” opportunity for distressed debt investors, according to SVPGlobal.
The high yield, leveraged loan, and direct lending markets in the United States are worth $4.5 trillion, according to a new paper from the distressed debt and private equity firm. With a projected 10 percent default rate for 2020, distressed investors will have many options to choose from.
BlackRock should be forced to split off its technology platform Aladdin to curb the growing influence of the world’s biggest asset manager, according to a report.
Rising stock indexes suggest investors are breathing a sigh of relief right now. Wall Street’s fear gauge says otherwise, though. Stocks have soared back to records, fueled by optimism about a coming vaccine for the novel coronavirus as well as relief that the election—widely anticipated for months—has passed. The Dow Jones Industrial Average has rallied 12.7% in November, on track for its strongest month since 1987. The S&P 500 has advanced 11% this month and hit a high on Tuesday.