Editor’s note: This was originally published on Sep 26, 2012 at http://go.mta.org/602 Let’s face it, in a zero interest rate world, yield is hard to come by. Maybe that’s why investors have been stampeding into high yield bonds this year.  We certainly aren’t complaining. The long side of our Long-Short High Yield Bond strategy Alternative Income has benefited. But there are emerging signs that it may be time to start reducing risk, and consider opportunities on the short side. The Federal Reserve announced the latest round of Quantitative Easing (QE III) last week. The consensus view is that this latest round of $85 Billion per month bond buying will send all liquid assets higher. Investors responded by pouring fresh capital into High Yield Bonds driving prices to new highs on the year. In a climate where the Fed is promising a zero interest rate policy from now until eternity it makes sense

Editor’s note: We are again reposting two short blog posts that have previously been posted under the blog section of MyMTA. These blogs offered varied insights into global markets. Access to this content is another valuable benefit of MTA membership. Canadian Investors Need To Watch Global Events by Larry M. Berman, CMT, CTA, CFA When the ECB stated that it would not likely pursue any more aggressive unconventional easing measure at this point, it deflated some of the hope of the QE crowd and hurt the gold sector. Spanish bond yields dropped about 15bps when the ECB cut rates, but have since risen to 7.00% following Mario Draghis’ speech. It had a negative impact on the euro versus the dollar, which in turn hurt lots of commodity prices. So a speech by the head of the ECB had more to do with what the TSX did yesterday than anything made in Canada. This is

One of the basic precepts of technical analysis is that history repeats itself.  Technicians make it a general practice to learn from history and bubbles are among the most interesting chapters of market history. Looking beyond just the price chart, there is a great deal to be learned from any bubble. The early seventeenth century was an important period in the development of technical analysis.  If CNBC had been covering the markets about 400 years ago, their attention would have been focused on the relatively small country of Holland where the biggest story in market history up to that time was unfolding. Tulips had gone from being just a beautiful flower prized by collectors to the most actively traded commodity of its time.  While it often took years to fully cultivate the actual flower, it might take only weeks to make millionaires out of traders who had started with nothing. In