Household equity holdings now account for 47% of total assets, according to Citi. That is the highest level since 1970. Returns were subpar for the next decade.
(Bloomberg) -- There are plenty of exchange-traded funds for when SPACs are shooting the lights out, and soon, one for when they’re hitting the skids.Tuttle Capital Management on Wednesday plans to launch the Short De-SPAC ETF in a departure from most such funds in the market that have sought to capitalize on the boom in blank-check companies.The ETF aims to make money on the stock losses of the 25 largest firms that have merged with special purpose acquisition companies. That includes once-hot stocks like Clover Health Investments Corp., Lordstown Motors Corp., Fisker Inc., Velodyne Lidar Inc. and QuantumScape Corp., which have each sold off this year as regulators clamp down and investors cool to these deals after an issuance bonanza over the past year.The Securities and Exchange Commission started to review the accounting behind these instruments and issuance, and after-market performance has stumbled. The IPOX SPAC index, which reflects pre-deal SPACs, is down 25% from its February peak.Read more: SPAC Mania Gives Way to ‘Meh’ as ETFs Drop Toward All-Time LowsShort-sellers have also started to circle the sector, questioning the validity of the businesses. Chamath Palihapitiya-endorsed Clover Health took a dive after Hindenburg Research published a report earlier this year saying the health insurer misled investors. Clover’s response, reporting an SEC probe but also referring to “sweeping inaccuracies” from Hindenburg, helped it recover only some of the losses before shares resumed their descent.Read more: Palihapitiya-Backed Clover Falls After Hindenburg Report History also shows that buying companies that emerge from SPAC combinations and holding them for one year results in an annualized loss of 15% on an equal-weighted basis, according to data from Jay Ritter, a University of Florida finance professor. But betting against them is tricky business, which the ETF aims to simplify.Short-selling a company’s stock requires finding the shares to borrow, before selling them with the intention of buying them back later for less. For SPACs, in particular, those shares can be scarce and expensive to borrow due to supply-demand dynamics.The Short De-SPAC ETF will use derivatives contracts, also known as swaps, to deliver the inverse return of the De-SPAC index. The index is rebalanced monthly.“Mechanically it’s not easy to short. Either shares are hard to find or expensive to borrow, so the economics don’t make a whole heck of a lot of sense,” Matt Tuttle, chief of the Greenwich, Connecticut-based shop that puts out thematic and actively-managed ETFs, said in an interview.Short-ETFs typically use swaps on the index, but the Short De-SPAC ETF will use swaps on individual securities. Because shorting SPACs even with swaps is difficult, the ETF may not track the index perfectly, Tuttle said.The Short De-SPAC ETF will fly under symbol “SOGU.”More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The European Union's executive on Tuesday adopted a plan for a more unified corporate tax regime across the bloc, whose 27 national systems are struggling to cope in a world where cross-border business, often via the Internet, is commonplace. Under its proposal, certain large companies operating in the EU would have to publish their effective tax rates to ensure greater transparency, and there would be new anti-tax avoidance measures to tackle the abusive use of shell companies. "It's time to rethink taxation in Europe," Paolo Gentiloni, European Commissioner for the economy, said in a statement.
Regulators cite the dangers of speculative trading.
“Widespread adoption of CBDCs may be disruptive for financial systems if associated risks are not managed,” warn Fitch Ratings analysts.
(Bloomberg) -- Asian stocks tracked U.S. declines Wednesday as concern about faster inflation shadows the economic recovery from the pandemic. A dollar gauge ticked up from near the lowest level this year.Australia underperformed, with the benchmark on track for its worst day in almost three months. Shares also fell in Japan and China after key U.S. equity benchmarks closed lower and large technology stocks like Amazon.com Inc. and Microsoft Corp. erased gains. AT&T Inc. plunged after the company said it plans to spin off its media operations. S&P 500 and Nasdaq 100 futures were in the red.A slide in crude on the possibility of more supply from Iran hurt energy stocks. Treasury yields were steady. Bitcoin and other cryptocurrencies extended a retreat after China warned digital tokens can’t be used as a form of payment. Markets are closed Wednesday in Hong Kong and South Korea for holidays.Stocks have been volatile after touching a record in early May, whipsawed by concerns about accelerating inflation amid elevated commodity prices, as well as a Covid-19 resurgence in some countries. Federal Reserve officials have repeatedly indicated that they see recent price pressures as transitory and intend to keep policy accommodative for some time to come. Traders are awaiting the latest Fed minutes for the clues about the outlook.“The market has been trying to process a very unusual economic environment and a confluence of factors that it has not faced for a long time,” said David Donabedian, chief investment officer of CIBC Private Wealth Management. “I personally would say that the stock market has absorbed it all extremely well because there’s still a high conviction view on earnings being strong.”In Bank of America Corp.’s latest fund manager survey, inflation topped the list of the biggest tail risks, followed by a bond market taper tantrum and asset bubbles. Covid-19 was in fourth place.Here are some key events this week:The Fed publishes minutes from its April meeting Wednesday, which may provide clues to officials’ views on the recovery and how they define “transitory” when it comes to inflationEIA crude oil inventory report WednesdaySt. Louis Fed President James Bullard and Atlanta Fed President Raphael Bostic to speak at separate events WednesdayIMF Managing Director Kristalina Georgieva and ECB President Christine Lagarde speak at the Vienna Economic Dialogue ThursdayEuro-area finance ministers and central bank chiefs hold an informal meeting. A larger group of EU finance ministers and central bank chiefs will meet May 22These are some of the main moves in markets:StocksS&P 500 futures dipped 0.3% as of 11:33 a.m. in Tokyo. The S&P 500 fell 0.9%Nasdaq 100 futures shed 0.3%. The Nasdaq 100 fell 0.7%Japan’s Topix index retreated 0.7%Australia’s S&P/ASX 200 index fell 1.8%China’s Shanghai Composite index lost 0.5%Euro Stoxx 50 futures fell 0.9%CurrenciesThe yen was at 108.96 per dollarThe offshore yuan traded at 6.4310 per dollarThe Bloomberg Dollar Spot Index rose 0.1%The euro was at $1.2223BondsThe yield on 10-year Treasuries was at 1.64%Australia’s 10-year bond yield dipped to 1.77%CommoditiesWest Texas Intermediate crude fell 1.2% to $64.70 a barrelGold was at $1,866.86 an ounceMore stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Colonial Pipeline, the crucial U.S. pipeline that’s been trying to recover from a debilitating criminal hack, restored a vital communications system that failed and temporarily left customers in the dark about fuel shipments.The computer system that allows oil refiners and other clients to reserve space and monitor the status of fuel traveling through the pipeline was back online after an outage earlier Tuesday, Colonial said in an email.Fuel shipments weren’t interrupted but the company sought to calm any concerns the outage might presage another disaster like the shutdown earlier this month that crippled gasoline and diesel deliveries across the U.S. Southeast.Fuel shortages continue to plague some cities and towns as Colonial works to fully restore the pipeline that supplies almost half the East Coast’s fuel and was halted for the better part of a week. More than 40% of filling stations in North Carolina are still dry, while in Virginia the figure was around 25%, according to retail-fuel tracker GasBuddy. The latest server disruptions stemmed from efforts to harden its systems and “were not related to the ransomware or any type of reinfection,” Colonial said.The communications outage meant fuel distributors found it more difficult to funnel shipments to supply-choked locations, said Andy Milton, senior vice president of supply at Mansfield Energy Corp., a closely held firm that handles more than 3 billion gallons of fuel a year.“Without that system, it’s very difficult to divert barrels manually,” Milton said. “Let’s say Charlotte becomes very tight and maybe we can divert barrels from Greensboro to Charlotte to help fill up in the market... If it’s not done quickly, those barrels may go right on past Charlotte and continue on towards Greensboro.”Gasoline futures traded in New York jumped as much as 1% after Bloomberg News reported Colonial’s communication glitch. Those gains later faded as it became clear there’s been no impact on deliveries.Deja VuFor some Colonial customers, Tuesday’s interruptions were uncannily similar to the early hours of what turned into the worst-ever cyberattack for a North American motor-fuel pipeline. On May 7, shippers began receiving notices of Colonial outages and within hours the company announced a total shutdown to combat the hack.The company paid almost $5 million in ransom to hackers but managed to keep it under wraps for five days. In the meantime, gas stations from Tennessee to Florida ran out of gasoline and diesel, stranding motorists and sending retail prices skyward. Major airlines took extraordinary steps like flying fuel cargoes to other cities to forestall shortages at airports.Colonial Hacker Group’s Dark Web SiteWeb SiteWeb SiteWeb Site No Longer Accessible The Colonial system, which transports roughly 2.5 million barrels of fuel daily from the Gulf Coast to the eastern seaboard, resumed service on May 12. The restoration of gasoline and diesel supplies has been hindered by a dearth of trucks and drivers to haul deliveries from distribution hubs to retail outlets.More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Stocks dipped on Tuesday, with the Nasdaq erasing earlier gains to join the S&P 500 and Dow in the red.
(Bloomberg) -- Ryanair Holdings Plc posted a record annual loss, while saying it’s likely to break even this year as vaccination programs allow a gradual easing of coronavirus travel curbs.Bookings have increased significantly in recent weeks, pointing to a strong recovery in the second half, although forward visibility remains “close to zero,” the Irish company said in a statement Monday. That’s made it impossible to provide more meaningful financial guidance.Europe’s biggest discount carrier is counting on lockdown-weary travelers flocking to the beach as U.K. curbs ease, starting with Portugal. Even if the revival transpires, Ryanair reiterated that traffic will remain at the lower end of an 80 million to 120 million passenger range for the year ending next March. Clusters of a more transmissible variant of Covid-19 that’s fed an Indian outbreak also pose fresh risks for the U.K. plan.“Scientific evidence over the weekend confirms that vaccines are effective against the Indian variant, but that it has a higher rate of spread,” Chief Executive Officer Michael O’Leary told Bloomberg TV. “We think it will be a one- or two-week wonder and then everyone will calm down.”Ryanair shares were up 1.1% as of 8:03 a.m. in Dublin. This year they have advanced 5.5%.Italy, GreeceShould the new strain prove more threatening there’s a risk of new lockdowns that could put Europe’s reopening into reverse, Chief Financial Officer Neil Sorahan said separately.Should markets continue to open up, Ryanair expects to be operating at 60% to 70% of normal summer levels.Bookings at Ryanair have tripled to 1.5 million a week since April 1, spurred by Britain’s reopening of leisure travel starting this week. O’Leary said he’s hopeful Italy and Greece will be added to a quarantine-exempt “green list” this month, followed by Spain in early June.The CEO said he’s in talks with airports in Italy, Spain, Sweden and central and eastern Europe about adding further flights, though confusion surrounding the delivery of Ryanair’s first 737 Max jets from Boeing Co. is impacting the company’s ability to commit new capacity.By the end of May, Ryanair’s fleet should have included 14 high-capacity examples of the Max -- now flying again after two fatal crashes -- but none have been handed over following the discovery of electrical problems. O’Leary said communication from the manufacturer has been “very poor.”Market ShareRyanair posted a loss of 815 million euros ($989 million) for the year ended March 31, compared with profit of 1 billion euros the prior year. The Dublin-based carrier said on April 7 the figure would be between in an 800 million-euro to 850 million-euro range.O’Leary said he expects capacity on intra-European routes to be materially lower for the foreseeable future, creating opportunities to target market share with lower prices, especially next summer, when Ryanair is due to have received as many as 65 Max planes out of an order for 210.Read: Sun-Hungry Brits Head South as Flights Resume After Covid Ban(Updates with CEO comments from fourth paragraph, adds shares)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
AT&T's stock is the biggest loser in the S&P 500 on Tuesday. Its valuation depends on how much credit investors give the combined WarnerMedia/Discovery for its future streaming efforts.
It's 2011. After a series of typical tech jobs, Bobby Lee decides to launch BTCChina, China's first Bitcoin exchange. It would be a wild ride.
‘Will she still be able to use our daughter as a tax deduction? My concern is also with the coming child tax credit this summer.’
A paper that my colleague Anqi Chen and I wrote last year — “How Much Taxes Will Retirees Owe on Their Retirement Income?” — keeps hitting the “top 10” list on a major listserv for social sciences research. As people approach retirement, they tend to add up their financial resources — Social Security benefits, defined benefit pensions, defined contribution balances, and other assets. The question we look at is just how large the tax burden is for the typical retired household and for households at different income levels.
Learn the basic structure of a 401(k) and why it may not be enough to sustain you during retirement.
AT&T investors are on the run after the company shocked Wall Street by unloading its WarnerMedia division to Discovery.
The Biden administration has announced payments will be starting this week.
Amid the slump sweeping across crypto assets Tuesday, investors were turning their attention to a meme asset, SafeMoon, that has garnered increased attention was recently drawing fresh looks after comments made by Barstool Sports founder Dave Portnoy on Twitter.
Raoul Pal tells bitcoin investors that current volatility is to be expected, but big things are around the corner.
Experienced hands look to be buying the dip as a key bitcoin price indicator suggests the pullback may be coming to an end.
At MAPsignals, we see the investing-world through the lens of stocks: specifically, outliers.
GameStop and AMC overcame rocky starts to the trading day as comments on social media surged and retail traders mused once again about “squeeze"s on both stocks.