Norway's largest bank is betting on crash of the US stock exchanges
Norway's largest bank is betting for the first time officially to a crash of the American stock market. Too many companies have gone into debt to pay out dividends - a tactic that would not work for long. The Bank holds a precaution a large part of their assets in cash.
Norway's largest bank, DNB, relies on a slump in the US stock market and increasing volatility in the world financial system. For the first time bought the investment funds of the Bank, which manages about 56 billion euros, therefore contracts the VIX index, which tracks the expected fluctuation in the American stock index S & P 500th Equities and global bonds, however, were underweight.
"The market is vulnerable. We see a lot more, which can pull the market down, as what could be a positive surprise. We can not see where positive surprises should come ", the head of DNB Investment Fund Bloomberg quoted.
In addition, the Fund has increased its cash holdings and now holds about 8 percent of its assets in cash. This is expressed together with the betting on possibly increasing market fluctuations a defensive attitude from. the realignment of the portfolio is justified by the fact that the expansionary monetary policy of central banks have led to an inflation of stock prices and yield loss in Anliehen.
Especially skeptical DNB is facing the US stock market and especially for utilities, food companies and telecommunications companies. "If some companies you look at, you can see that many have debt to pay dividends can. How long can this go well? If they are priced in the market as a dividend stock and then have to change their dividend policy sometime the consequences for the share price considerably. "
Regarding equities, emerging countries currently would offer the most potential. "Emerging markets had a hard time recently. For years, many investors were overweight in and have then sold gradually, as the prices fell. Now you have a pretty good mix: the emerging countries are rather unpopular, have fallen sharply and are low. In addition, has the commodity price decline, which has pulled down weakened. "
( Source )