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We wrote about Factor MAX, a twist on momentum investing that goes long the factor that had the largest single-day return in the previous month.
Markets this Week
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The Misguided Beliefs of Financial Advisors (wiley)
Advisors typically invest personally just as they advise their clients. Advisors trade frequently, chase returns, prefer expensive and actively managed funds, and underdiversify. Advisors' net returns of −3% per year are similar to their clients' net returns.
India
SEBI proposes opening up Direct Market Access for retail. DMA is a facility that allows investors to place buy and sell orders directly into a stock exchange's trading system through a broker's infrastructure, without manual intervention by the broker's dealer (moneycontrol).
The Indian government is in talks with the UAE to sell some of its flagship defence systems, including the supersonic cruise missile BrahMos and air defence system Akashteer (reuters).
The India-US GE F414 engine deal has hit a roadblock after steep price escalation pushed costs beyond ₹200 crore per engine. The US has tripled the price of every engine around three times (timesnownews).
Smaller cities are emerging as a major source of corporate travel in India, with nearly 60% of bookings in the first half of this fiscal year originating from or routed to such cities (economictimes).
The government has issued a series of amendments tightening the FCRA Rules for NGOs and associations in India on receiving and using foreign money, allowing a range of faith-based activities while excluding proselytisation (hindustantimes, thehindu).
Police in several States have started collecting DNA records, primarily from blood samples, of suspects arrested in heinous crimes. Along with DNA profiles, photographs, fingerprints and iris scans, the government is creating a unique identification record of arrested persons and convicts that can be retained for up to 75 years (thehindu).
One-gram gold ring for babies born in Tamil Nadu government hospitals (thehindu). Andhra Pradesh already gives Rs 30,000 to families on the birth of a third child and Rs 40,000 for the fourth (ndtv).
row
From batteries and solar panels to rare earths and life sciences, China is developing some of the world’s most advanced technologies. These advances are raising major questions for U.S. officials, who see danger in relying too much on Chinese technology (nytimes).
China's foie gras production may have hit as much as 14,000 tons last year. That would represent a jump of roughly 30% from 2024 and compares with estimates of just 2,000 tons a decade ago. France — the world's leading producer — saw output slip 3% to 15,044 tons last year (reuters).
As many as 100 million Chinese consumers are struggling to service their personal debt. Bad consumer loans from credit cards to mortgages have surged over the past few years. Non-performing household debt soared 21% last year to a record of at least 2.22 trillion yuan ($329 billion). As much as 5% to 6% of retail loans at some of China’s large banks could be non-performing. The debt overhang is undermining national efforts to boost domestic consumption (bloomberg).
The puzzle is not why China exports cars but why it is still exporting t-shirts. China competes with America and with Africa at the same time. It somehow holds a capital-cost advantage and a labor-cost advantage at the same time (yashenghuang).
Hormuz tolls: within two months, either Iran blinks, or the US does, or the MoU breaks down (rabobank).
The war was a demonstration of Iranian strength whose psychological consequences will be immense. The negotiations, conversely, look to be a no less potent demonstration of American weakness or stupidity (theatlantic).
Nearly 15,000 U.S. cities will face noticeable depopulation by 2100. A study estimates that the largest losses will come from the Northeast and Midwest as people move to the South and West (popularmechanics).
By May 2026, 332 of 1,900 Silicon Valley unicorns had raised money at a valuation at or below their peak (economist).
Temperatures are forecast to reach as high as 40C this week, with Britain sweltering under a record heatwave that has forced schools to close, brought trains to a halt and led to the Met Office issuing a red “risk-to-life” warning… and homeowners are being forced to tear out air conditioning from their private properties under climate laws (yahoo).
The US government Friday lifted its block on Anthropic’s powerful Claude Mythos 5 AI model, allowing the company to release it to more than 100 US institutions, including major companies and government agencies (semafor).
Meme of the Week
