“Nomura’s Andy Chaytor, Kevin Gaynor, and Bob Janjuah have a new note just out titled Time To Set Risk-Off Trades.
In English that just means: SELL!
The note is a followup to Janjuah’s bearish note yesterday, which predicted a selloff that goes through November. Note that this is not the ‘House View’ but rather the view specifically of Chaytor, Gaynor, and Janjuah.
After the big rally we’ve seen in equities (Europe and the US), risk currencies, and European government bonds, “risk off indicators proliferate” in their view.
What are some of these indicators?
One is simply: The S&P divided by the VIX, a crude measure of optimism combined with complacency. Suffice to say, it’s very high on a historical basis.”
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