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Trader Court
เข้าร่วมเมื่อ 15 ธ.ค. 2018
Hedge fund BAILOUT? Has the Fed revealed an issue with hedge funds??
The Federal Reserve has considered lending money DIRECTLY to hedge funds. WHY would they consider doing this and WHAT is their rationale?
Source: www.wsj.com/articles/hedge-funds-could-make-one-potential-fed-repo-market-fix-hard-to-stomach-11578997801
Federal Reserve officials are considering a new tool to ease stresses in the market for Treasury repurchase agreements (repos)
One solution idea that has been bounced around is to lend cash directly to smaller banks, securities dealers and hedge funds
This would be done through the repo market's clearinghouse, the Fixed Income Clearing Corp., or FICC
Source: www.wsj.com/articles/hedge-funds-could-make-one-potential-fed-repo-market-fix-hard-to-stomach-11578997801
Federal Reserve officials are considering a new tool to ease stresses in the market for Treasury repurchase agreements (repos)
One solution idea that has been bounced around is to lend cash directly to smaller banks, securities dealers and hedge funds
This would be done through the repo market's clearinghouse, the Fixed Income Clearing Corp., or FICC
มุมมอง: 486
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What is ACTUALLY going on in the repo market and what do Hedge Funds have to do with it?
มุมมอง 2.7K4 ปีที่แล้ว
WHY did the repo market go CRAZY in September 2019? DISCOVER the role banks and hedge funds played in the overnight funding debacle we witnessed that led to the Federal Reserve injecting billions of dollars into the system DAILY. OVERVIEW Repo is a generic name for repurchase transactions. In a repo transaction, one party sells an asset (such as Treasury Bonds) to another party at a set price. ...
A brief primer on repo operations and the primary dealers that engage in them
มุมมอง 1.2K4 ปีที่แล้ว
The Fed uses repurchase agreements ("RPs" or "repos") to make collateralized loans to primary dealers. A primary dealer is a bank or securities broker-dealer that trades directly with the Federal Reserve System of the United States They are required to make bids or offers when the Fed conducts open market operations, provide information to the Fed's open market trading desk, and to participate ...
NY Federal Reserve Repo Operations - What is it? In the news, September 20, 2019
มุมมอง 6214 ปีที่แล้ว
NY Fed added an additional $75 billion to the bank lending markets Friday, bringing its four day total to just over $275 billion. This was after repos surged between Monday afternoon and Tuesday morning Repos refer to repurchase agreements. This is the cost of borrowing cash in exchange for US Treasuries. The rate surged to as high as 10 percent, an increase of more than fourfold overnight Mond...
How to download stock prices using Python
มุมมอง 8615 ปีที่แล้ว
Github link: github.com/cjcarlsen/TH-cam-tutorials/blob/master/Downloading and Saving S&P 100 Stock Pricing Data using IEX Finance.ipynb In this video I walk through how you can download stock price information using the IEX API in a Jupyter notebook environment. This can be extremely useful if you're looking to do more extensive research on stock pricing information and can save you a ton of t...
Introduction - Data Science for Finance Using Python
มุมมอง 3.3K5 ปีที่แล้ว
In this introductory video, I discuss the Data Science for Finance series that I will be creating. Patreon: www.patreon.com/ccarlsen Paypal: paypal.me/courtcarlsen?locale.x=en_US Bitcoin Address: 1MTb4sDXVWMXx3CdxyLqWDVLdokLaghrnu
Understanding Collateralized Loan Obligations (CLOs) and Risks they Pose
มุมมอง 30K5 ปีที่แล้ว
In this video I discuss the Collateralized Loan Obligation market, what CLOs are, how they are created, why CLOs are attractive for companies, asset managers, and institutional investors, what risks there are in the CLO market, and what Janet Yellen and Ray Dalio have to say about CLOs.
Your a Fool and 5 years later, it definitely confirms this! CLOS's have made and continue to make TONS of $$$ and excellent returns for much lower risk easy 8%-15%+ returns in CLO etfs for extremely little Prc NAV erosion risk in fact nav apprec is achieved with very nice monthly distributions for income
Why is so similar to cdo
Thank you, comprehensive video covering topics 360 degree. 👍
Super informative video
Trader Court - How successful was TA-LIB at identifying stock chart patterns? Also, My son just got accepted to John Carrol University with a Major in Data Science. Thanks for this video. Looking for the 3 Bar Play on stock charts
TRADER COURT EXCELLENT VIDEO. I AM JUST NOW WAKING UP AND CONNECTING THE DOTS. THANK YOU SO MUCH.
fantastic stuff. thanks
So the hedge funds are borrowing at the short-term repo rate by using treasuries as collateral but it sounds like they still get the interest from the treasuries even though they are sold overnight. So they are borrowing short and investing long to get the spread? Then, they are able to keep leveraging this trade to amplify returns. It seems like this trade makes sense in a rate decreasing environment when longer-term treasuries would increase in value?
80% cov-lite is exaggerated. Most of the CLO managers have maximum limit of 30% in the portfolio. These could be found in portfolio profile tests in the offering circular.
Very interested. I'm starting my data science learning journey in the field of finance. Thank you for the amazing content!!
By the way, are you now working in the financial industry as a bid data or python programmer?!?
Like your channel. Here is a topic that I can't find anyone else covering. Investment channels keep talking about corporate debt but no one ever explicitly points out these corporations or shows how the find the debt to income ratio. What debt is good? Which debt is bad? Which debt is on adjustable terms which debt is fixed ... How do you find out which corporations are on the edge? Thanks you for all your efforts!
Glad I found this video...great content!
thanks for this, great explainer. what do you think of them now with all that has happened ? plus banks now have those on their balance sheets. next financial crisis?
Thanks. Pls give more explanation on how hedge funds work..
Thanks Trader count could you explain the relationship between repo haircut and maximum theoretical leverage in a future video? Many thanks, Arthur
very appropriate explanation thanks
Great video! Thanks a lot!
Great explanation, you should return to making videos
Great job 👍
Great video! Would love to see a video outlining how the tranches are priced in the secondary market. Interested to know more about the correlation impact.
I just discovered your channel and I wanted to thank you for the high quality content you provided. Hope you keep on making more.
Bain under romney and BlackRock now guiding us treasury. I thought blackrock is isreali
Thank you for the simple video but clearly explaining the collateral. I am surprised that we have primary dealers from Japan and England. Is there a significance for these foreign operated primary dealers to have access to federal reserve funds?
COVID just might be the fire match of this bomb.
Great video! Thanks for sharing.
Speed -> 1.25x
What's you updated view of the current CLO with the economy where it is? Also, where can we find individual CLOs and the businesses that make them up? Is there a way to actually see the loans inside of them?
What is that trading strategy referred to? There's a term for it but I can't remember it
Does primary dealer trade directly with the Fed, since they didn't have an account at Fed? I thought they trade with clearing banks and clearing bank trade with the Fed.
I have seen your video explaining the CLO market, its faboulous, thanks!! I think it would be awesome if you could make a video explaining how could the CLO be affected now, and how could it affect the stock market in current days if lot of companies enter in a path to default (is that trillion liquidity from Fed going to solve it short/medium/long term?)... As well, the CoCo's (contingency convertible bonds) could maybe multiply the magnitude in the decrease of price in the stock market??
Excellent. Thanks.
can't wait for this blow up
They not gonna Blow up(not right now but maybe in the near future) , the Fed is buying Corporate Bonds and ETF who replicates those Bonds. It could either lead to the point where banks get greedy like in 2007 and mix more Dogshit into these Tranches (because "heyy man the fed buys those crap bonds anyways so why not go full risk") putting more and more air into this bubble or nothing happens and the bubble pop is moved to the future.
If the primary dealers are short on liquidity, from where are they getting the cash to buy the Treasuries to pledge or sell to the Fed?
I was trying this method but it has some issues i was not able to excute as you did did each and everything i possibly could as I dont have much knowledge about python errors are mysteries to me.... After entering filename = r"Datasets\s&p_companies.xlsx" sp100_companies = pd.read_excel(file name) It shows me error from wrappers (*argu, **kwargu) Tried everything even downgrading python libs but I am not getting what is the issue.. Pleassseeeeeee help
Hi Gunnerr sorry about that! IEX made some changes to their API that cause it to not work the same way it used to. I've been using a library called yfinance to download stock pricing data. I'd like to make an updated video so stay tuned. Here is a link the doc for yfinance in the meantime: pypi.org/project/yfinance/
I really really really really liked the video. Please make some more like this.
th-cam.com/video/Mj0JAfq4esk/w-d-xo.html
I am writing a report to EU's Advisory Board on Green mortgages. This is a great video and helped me a lot to understand CLOs..
Thanks for the kind words Duygu I'm glad you found this helpful!
@@tradercourt340 your welcome...new to these topics but I find quite interesting...
This definitely helped me understand better. Thank you
If corporations start defaulting due to decreasing earnings, won’t the whole stock market go down as well anyways? Not just CLOs?
Do you think CLO will make the world bankruptcy again just like CDO?
Can I find out which Banks are short on funds?
That's what we all want to know! Perhaps look into the primary lenders with the Fed and see if any have struggled to maintain reserve balances?
Good video on a topic that is not discussed too much - would you mind sharing your reference of where you came to the conclusion of "all loans in CLOs are Junk rated.' Thanks!
I was able to find a great explanation of this at Guggenheim Investments. www.guggenheiminvestments.com/perspectives/portfolio-strategy/collateralized-loan-obligations-clo “Portfolios of bank loans, also known as leveraged loans, act as the collateral supporting CLOs. Leveraged loans are senior-secured loans to below investment-grade companies.” So I may have misstated when I said all loans were junk, since BBB rated loans are below investment-grade and just a notch above junk rated bonds. Good question Daniel!
CLOs are not allowed to hold more than 7.5% of ccc rated loans, rest all are above CCC rated, majorly B rated, so to say all CLO. loans are junk is irresponsible at best, let's not create panics in the market, CLOs are pretty safe investments
Thanks for the update Darshana and great point. I think people do not understand how crazy a default scenario would have to look like for AAA or AA tranches to lose $1 of principle. It’s easier to find flaws in something that one doesn’t understand!
@@danielrombola6257 this was the thought process that led to the GFC....watch the big short AAA rating was nothing more than a rubber stamp
Thanks, Court! I'm writing research on CLOs and counterparty risk, and you gave me some great ideas to look into!
Thank you for this thoughtful and timely explanation of CLOs and the broader market context.
Thanks Court Carlson! Now I know more about CLO'S maybe I should get the hell out of the ones I'm in.
I'm glad you found the video helpful James!