Dan Greenhaus Perfectly Describes The Dilemma That Almost Every Investor Is Fretting About Right Now
Dan Greenhaus at BTIG has a great paragraph in his latest nightly note that almost perfectly describes the mentality of a lot of investors right now:
In a recent conversation with one of our hedge fund manager clients, we were pressed on our views (which we will expand on tomorrow). As we said then and repeat here, we think the outlook for equities is somewhat good but we remain laser focused on the debt ceiling. As such, a hedged position is probably warranted, something BTIG’s option team notes can be achieved simply through cheap March put spreads on the SPY. However, such a view -- favoring hedges -- is probably part of the reason Goldman Sachs noted 88% of hedge funds underperformed the S&P 500 in 2012. But with the President set to nominate Jack Lew to Treasury Secretary (Republicans really don’t want him) and with the looming debt ceiling standoff, we just wouldn’t feel comfortable with another position, even as the argument for market participants getting more comfortable with Washington dysfunction grows with each successive standoff.
Bingo. Everyone wants to be bullish, but there's just this one problem...
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