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What is so unique about hedge funds?

Apart from the fact that hedge funds could leverage and short sell the stock, one of key differentiation between hedge funds vs mutual funds would be their concentrated "bet" - hedge fund returns depend on the performance of a few key stocks. 

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Defaults is spreading outside commodities

The latest research from Deutsche Bank AG found that there are already signs of contagion in junk-rated debt outside of the commodities space, as evidence that the defaults of Quicksilver Inc, American Apparel LLC and Aeropostale Inc, which are from the retail sector.

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Nifty Nine is driving US Markets

The return generated by US bonds and equities were flat for 2015.  It is the 2nd worst collective 12 months since 1995 - outstripped only by the disaster year of 2008.  On the other hand, "Nifity Nine" - Facebook, Amazon, Netflix, Google, Microsoft, Salesforce, eBay, Starbucks and Priceline beat the rest of the US market by more than 60%!

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Significant New Wave of High Yield Issuance Coming

“We expect a significant wave of new issuance in late 2016 and 2017, as companies begin to address their upcoming maturities,” said Tiina Siilaberg, a Moody’s senior analyst. “However, a range of macroeconomic factors will make it more difficult for lower-rated companies to tap the debt capital markets in order to refinance their debt obligations.”

{loadposition adsense_r336x280}Those factors include rising interest rates, the widening of spreads over Treasurys, the slowdown in China and oil-price volatility. At the same time, a stricter set of rules on leveraged lending that caps debt levels will also weigh on lower-rated companies.

A record $947 billion of U.S. high-yield, or “junk,” debt, is scheduled to mature in the next five years, and some issuers may struggle to refinance it, Moody’s Investors Service warned on 2016-02-16.

Of that total, $400 billion is set to come due in 2020, the highest amount of rated debt to mature in a single year in the history of credit markets, Moody’s said in a new report.


  1. MarketWatch, Ciara Linnane, 2016-02-16, "Junk-bond Market Facing Record Refinancing Cliff:  Moody's"


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Read more: 金融风暴正重现