Financial Times Newsmine - Financial 6/10

Financial

On the securitisation market, June 10

"Bankers are still struggling to make the point that not all securitisations are the same. Only 0.07 per cent of European residential mortgage-backed securities have
defaulted, for example, compared with a rate of 9.62 per cent in the US, according to Standard & Poor’s, the rating agency."

The Short View (James Mackintosh) on hedge fund performance, June 9

"Since the peak of the market in October 2007, a do-it-yourself portfolio of 60 per cent shares and 40 per cent government bonds, rebalanced each year, has slightly
beaten the average hedge fund. Last month repeated the pattern: hedge funds fell 1.3 per cent, according to the HFRI Composite index, while the simple portfolio rose a
fraction."

The Short View (James Mackintosh) on credit spreads between emerging markets and developed countries, June 7

"There are plenty of other emerging markets trading even more like developed countries. Credit default swaps from copper-rich Chile suggest it is as unlikely to
default as France. Panama and Malaysia rank with Japan. Belgium is seen as more likely to default than Mexico or Colombia. Brazil’s 10-year bonds yield just 1.2 percentage points more than the US."

On bear market sentiment in the US, June 4

"Last month margin loans for shares on the New York Stock Exchange hit $320bn, their highest since just before Bear Stearns collapsed in 2008 – having been growing at an annual rate of 50 per cent recently. According to the Investment Company Institute, cash holdings in US equity mutual funds matched their lowest in 27 years of
data."