Paul Laverty, head of Business Development at DEGIRO Ireland discusses the major market stories for March.
TWITTER TRADING
As with any new president, investors are waiting to see how Trump will affect markets during his time in the Oval Office. One unique issue which arises with Trump though is his frequent activity on social media. With 24 million Twitter followers, the new US commander in chief has an unparalleled outlet which can send markets reeling in 140 characters or less.
In what is developing into a new investment strategy, retail as well as professional traders are trying to Trump the market by reacting to the President’s company specific tweets.
Recent attacks have included cost shaming Boeing over Air Force One upkeep charges and slamming department store chain Nordstrom’s for perceived slights against the first daughter.
Trump’s tweets are not limited to the pessimistic though. While he has called out GM and Toyota for investment into Mexico, he has praised Ford and Fiat for keeping jobs in America. Meanwhile companies are also hitting back. Tech giants Apple, Alphabet, Amazon, Facebook and Microsoft have come out against the controversial ‘Muslim ban’ limiting entry into the US for citizens of seven predominantly Muslim countries with the Uber CEO stepping down from his participation on Trump’s advisory council.
BREXODUS
With Theresa May now in charge of triggering Article 50, British banking businesses look toward other countries to maintain an EU foothold. Barclays has already announced that it has opted for Dublin as their post-Brexit headquarters and Credit Suisse has also expressed an interest in moving back office jobs to Ireland.
Dublin may have to fight for some of the post Brexodus business though as German financial regulators are looking to ease the move of foreign firms into Germany in a bid to coax businesses into moving their operations to Frankfurt.
Banks would be able to keep their current models for setting capital requirements for a two-year transition period. Said to be considering Frankfurt as their new EU hub are Citigroup, Goldman Sachs and UBS.
Paul Laverty, DEGIRO
DAWN OF AN AI-ERA
In what could be the start of a major shift into automated investing strategies in the hedge fund world, for the first time computer driven strategies are competing for the title of the most successful hedge fund.
With Theresa May now in charge of triggering Article 50, British banking businesses look toward other countries to maintain an EU foothold
In LCH Investment’s annual list of the top hedge fund managers of 2016, 4 of the top 20 best performing funds are managed by a systems-based or algorithmic trading approach. The four funds have made $113 billion in net gains and make up nearly a quarter of the total gains of the top 20.
It’s not only the funds industry which is seeing a move toward automation in the increasingly digitalised financial world. Professional services firm Accenture expects thousands of banking jobs to be replaced by automated regulatory systems in a move toward ‘robo compliance’.
Meanwhile sell side research reports are becoming an increasingly outdated tool in a world where investors have instant access to breadth of information and online investment platforms.
Photo: Business image created by Pressfoto – Freepik.com
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