Trading the Dispersion: chapter I

Since the development of the Black-Scholes formula for determination of the price of options, the “implied volatility” has been an ordinary tern in markets participants’ vocabulary. Given the non-linear payoff of options, they can be used to implement trading strategies which are not directional (that is, they are not based on a bet on a […]

Market Recap 05-11-17

United States Last Thursday President Trump nominated Jerome H. Powell to chair the Federal Reserve, bypassing Janet L. Yellen for a second term but turning to a replacement who is expected to stay the course on monetary policy if the economy continues its steady growth. As a result, investors do not expect an aggressive hiking […]

Sliding down the yield curve. How to tackle the slope?

Introduction to the Yield Curve and its Evolution 15 August 1971, the day the Bretton Wood System was dissolved, will remain an important moment in economic history, representing a major shift in our international monetary system, a change in approach to perceived market risk and a departure from the gold standard. Floating exchange rates induced […]

Hong Kong warns: Li Ka-shing sells The Center in US$5.15bn record deal to trim his HK’s assets

CK Asset Holdings Ltd (1113:HK) – market cap as of 05/11/2017: HK$246.07bn Introduction On November 1, 2017, CK Asset Holdings announced an agreement to sell the skyscraper located in Central (Hong Kong) known as “The Center” to C.H.M.T. Peaceful Development Asia Property for a total transaction value of HK$40,2bn ($5.15bn). The sale of The Center, […]

Novartis places a $3.9bn bet on radio pharmaceuticals

Novartis AG (NYSE:NVS) – market cap as of 04/11/2017: $219bn Advanced Accelerator Applications SA (NASDAQ:AAAP) – market cap as of 04/11/2017: $3.56bn Introduction On October 30, 2017, Novartis announced its intention to make a tender offer for 100% of the share capital of Advanced Accelerator Applications, for a total consideration of $3.9bn. AAA’s key product, […]

Still a long way to go: Hochtief’s bid opens takeover battle with Atlantia for Abertis Infraestructuras

Hochtief AG (ETR: HOT) – market cap as of 03/11/17: €9.87bn Atlantia SpA (BIT: ATL) – market cap as of 03/11/17: €22.68bn Abertis Infraestructuras S.A. (BME: ABE) – market cap as of 03/11/17: €18.34bn Introduction On October 19, the German construction company Hochtief announced a counterbid of c. €19bn for the Spanish infrastructure company Abertis, […]

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