Tuesday, February 15, 2011

Checking Up on the Consensus Trade

Claus Vistesen submits:

One of the main investment and trading themes crystallized during Q4:10 was the move out of emerging markets and into developed markets. As all themes, it started as a contrarian misfit moving against the truck loads of capital piling into emerging markets but has now reached its mature state flapping its wings as a beautiful butterfly and the main investment theme du jour. We know this because the Economist devoted a piece to it in their latest print edition

One reason to look elsewhere is that Western economies? prospects look sunnier than they did a few months ago. American consumer confidence has rebounded more quickly than expected, for instance. Much of the money that has come out of emerging economies has gone straight into developed markets, in what Michael Hartnett at Bank of America Merrill Lynch has dubbed the ?Great Rotation?. Rich-world stockmarkets may also be the big beneficiaries of


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