In yesterday’s note to clients, Bridgewater Associates addressed China, hoping to clear the air. Their comments, however, were timed just as many hedge funds are exiting the Chinese currency trade. Bridgewater wanted to make it clear that China is not in any unusual economic environment. The Asian nation is “going through the same sort of debt and economic adjustment processes that all countries have gone through at one time or another.” Calling the adjustments taking place “healthy” and saying China will emerge “stronger” as a result. This message counters many of the negative hedge fund positioning that has recently changed. The…
Hedge Funds Lighten Up On Chinese Yuan Trade
Mark Melin
Mark Melin is an alternative investment practitioner whose specialty is recognizing the impact of beta market environment on a technical trading strategy. A portfolio and industry consultant, wrote or edited three books including High Performance Managed Futures (Wiley 2010) and The Chicago Board of Trade’s Handbook of Futures and Options (McGraw-Hill 2008) and taught a course at Northwestern University's executive education program.