| Working Paper Synopsis: The Search for the Beta of Commodity Futures
In accordance with the principles of modern portfolio theory, sophisticated investors have increasingly sought to diversify their portfolio through the use of alternative investments. An "alternative investment" is generally regarded as supplementary assets or trading strategies other than long-only exposure to "traditional assets" such as stocks, bonds and/or cash. Alternative investments include various assets such as commodities, currencies, emerging markets and private equity, as well as a variety of trading strategies such as convertible arbitrage, distress securities, global macro, long-short equities, managed futures, short selling, etc. Adherents commonly assert that alternative investments has (i) a low to negative correlation compared to traditional investments, (ii) historical performance which reflects the potential for attractive positive expected returns, and (iii) is capable of acting as a hedge against inflation.
Oil price strikes record $US90
CRUDE oil prices struck a record $US90 a barrel in after-hours trading in New York overnight, amid increased tensions between Turkey's government and Kurdish rebels in northern Iraq. Traders said a weak US dollar and supply jitters had also stoked the price surge. The price gains came after New York's main oil futures contract, light sweet crude for delivery in November, had jumped $US2.07 to a record close of $US89.47 a barrel. London prices also pushed higher in after-hours trading, as Brent North Sea crude for December delivery soared to $US84.88 after the contract had earlier settled $US1.47 higher at $US84.60. Oil prices have pushed higher this week amid geopolitical angst related to the Turkey-Iraq border and a weakening dollar, which makes dollar-priced commodities such as oil cheaper for buyers with stronger currencies and therefore lifts crude demand.
and the Chicago riot
Kennedy upset veteran Vice President Richard M. Nixon. One of the key factors in Kennedys victory was his expert handling of television as a campaign tool. Nixon, after suffering another crushing defeat in the California gubernatorial elections bounced back to win the presidency over Hubert H. Humphrey and a key factor in the Republican Party victory was the TV coverage of the Chicago police brutality against demonstrators. The brunt of the accusation was laid on the doorstep of Chicagos political boss, Mayor Richard Daley. Among the victims of police brutality were famous print and TV journalists. A book on media history, The Press and America, by Edwin Emery and Michael Emery reports that news media suffered some 70 injuries at the hands of the police, equally divided between print and electronic media.
Russia's Economy Looks Good From Davos
Before Thursday, the ruble-denominated MICEX index, where Russian stocks are most traded, had shed 20 percent since its Dec. 12 high -- the common definition of a bear market. On Thursday, the index jumped by 5.8 percent, its biggest gain in 19 months. The dollar-denominated RTS index added 5.2 percent Thursday. (Story, Page 5.) Optimism over Russia's outlook seems to be prompting some investors, including Pakistan's largest private bank, Habib Bank, to take a closer look at the country. "I think the emerging markets are going to be largely immune to the subprime crisis," said R. Zakir Mahmood, president and CEO of Habib Bank, which has more than 1,400 branches. Mahmood said he was looking to establish ties with Russian banks and companies and would attend the St. Petersburg International Economic Forum this June for the first time.
AEP Transmission Venture With Allegheny Files to Establish FERC Rate ...
COLUMBUS, Ohio, Dec. 28 /PRNewswire-FirstCall/ -- American Electric Power today announced that Potomac-Appalachian Transmission Highline LLC, AEP's transmission joint venture with Allegheny Energy , has filed with the Federal Energy Regulatory Commission (FERC) to establish a transmission rate to recover costs for the approximately 290-mile, extra-high voltage transmission line that the companies propose to build from West Virginia into Maryland. The companies are seeking a transmission cost-of-service formula rate, effective March 1, 2008, that will provide for annual updates to the amounts that PJM Interconnection (PJM), an independent regional transmission operator, will charge utilities to recover the costs of the project. The proposed rate includes recovery of a return on construction work in progress (CWIP) for the project and a return on equity of 14.3 percent, which includes an incentive award, consistent with federal policy to encourage significant transmission infrastructure and technology improvements.
CME up after volume jumps
After a halting start, the year-end rally gained momentum, with stocks rising roughly 7 percent in less than two weeks.
Among winners, shares of CME Group Inc., the world's largest futures exchange, shot higher after November volume advanced 41 percent on rising volatility.
Traders saw their business boom as economic uncertainty caused investors to hedge or speculate with futures contracts tied to equity indexes and interest rates on the Chicago Mercantile Exchange and Chicago Board of Trade, both owned by CME.
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