Global Shocks An Investment Guide for Turbulent Markets / by Nicholas P. Sargen.

How should investors manage portfolios during crises?  This question has surfaced since the 2008 global financial crisis, which is the latest of a series of shocks that began in the early 1970s.  While crisis situations offer opportunities to outperform markets or to be engulfed by them, little has...

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Bibliographic Details
Main Author: Sargen, Nicholas P. (Author)
Corporate Author: SpringerLink (Online service)
Format: eBook
Language:English
Published: Cham : Springer International Publishing : Imprint: Palgrave Macmillan, 2016.
Edition:1st ed. 2016.
Series:Springer eBook Collection.
Subjects:
Online Access:Click to view e-book
Holy Cross Note:Loaded electronically.
Electronic access restricted to members of the Holy Cross Community.

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520 |a How should investors manage portfolios during crises?  This question has surfaced since the 2008 global financial crisis, which is the latest of a series of shocks that began in the early 1970s.  While crisis situations offer opportunities to outperform markets or to be engulfed by them, little has been written to guide investors when markets are not functioning normally.    This book, which is written from a practitioner’s perspective, fills the void by providing the reader with a toolkit and guiding principles to manage money when markets are in turmoil. It features ten case studies beginning with the breakdown of the Bretton Woods fixed exchange rate system through the current situation in which investors are assessing whether China could become the next bubble. Each chapter discusses how the respective crisis or bubble unfolded at the time, the way policymakers and markets responded, and the optimal strategy for positioning portfolios.The goal is to share these experiences and the lessons from them, so investors will be better prepared for future shocks. The opening chapter explores whether there are common patterns in movements of interest rates and exchange rates that investors can exploit.  A conceptual framework is presented that helps explain why this is the case for traditional currency crises, but less so for asset bubbles.   The concluding chapter ties the episodes together and considers how the nature of financial crises has evolved since the collapse of Bretton Woods. We cite factors that make it difficult for policymakers and investors to detect problems in advance of an asset bubble. The good news is investors get a second chance to outperform when markets are over-sold; however, they need to formulate a strategy to limit the damage during the sell-off phase and to capitalize on the eventual recovery.  . 
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