This week’s podcast features Colin Lambert and Julie Ros taking a look at the week’s event, along with a bit of inter-office banter. Lambert kicks off by asking a question of Ros and the audience and, when he eventually gives the answer later in the podcast, the latter is quick to claim she was going to say that answer…even though she actually answered with something else!
The discussion then moves onto events in the oil market and Lambert’s suggestion that what we actually witnessed was a phenomena across markets – the end of “sell the rumour, but the fact”. Instead, he argues, what we have is an over-reliance upon data which breeds a herd mentality and, when the data disappears, a mad rush for the exit.
Ros then asks Lambert about the latest paper from the FICC Markets Standards Board on algorithmic trading and machine learning. This is a subject Lambert has discussed previously, indeed with the FMSB’s chair Mark Yallop, and while he expresses a little concern over FMSB and the Global FX Committee both having work streams on algo trading – probably with committee personnel in common – he thinks the paper is very valuable for fixed income markets, into which algo execution strategies are starting to creep.
The discussion then moves onto the impending bitcoin halving, which means Lambert shuts up! Ros takes us through the likely outcomes and highlights the inter-connected nature of crypto markets, asking why the different digital assets – which all have different uses – remain inextricably linked in price action terms? Lambert, as always, has a theory, and, as always, it involves one of his bugbears – tracking error and benchmarks.
The podcast closes out with some images the audience may wish they could lose quickly as the two look forward to next week’s Profit & Loss Dial-in Day and the associated chat, sartorial and social activities.