Comments
Transcript
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NGMarket makers hedge all their deltas since they generate income from rebates from volume/providing liquidity. Can someone explain why he suggests hedging a directional bet? So you are shorting KSA and longing energy, i.e. your gains in one will be offset by your losses in another i.e. you are basically at 0. Rather just sit in USD then? What am I missing?
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SDDoes anybody know where to buy USDSAR fx options?
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FBI'm stuck with one question, that I can't get my head around. How would a devaluation help them when they still need USD to pay for the imports? Is it that their reduced current account surplus would then simply be worth more in Riyal terms, thereby avoiding a deflation? Would be great if someone could enlighten me.
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MBVery interesting perspective... thanks. However Alexander, you continual use of the filler "you know... you know... you know... you know" is very distracting from your message and the perception of your professionalism. Please take this in the constructive manner it's intended.
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AKSaw on Bloom today that wheat, rice prices are at 7 year highs so that part of thesis seems to be working.
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NLneed to also take in consideration that Saudis have second largest defense budget in the world. Most of that spending is on US weaponry. If things escalate Saudis can cut spending on defense and hit US weapon's manufacturers hard. US may have to opt to sacrifice its shale.
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MLI am not sure shorting KSA banks is a great idea. There is significant tailwind behind these banks performing that it increases of getting rekt due to collateral events. In other terms, while the idea of shorting the peg is a great asymmetric option play à la Soros, this will be much harder to execute in this case.
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SMGuess I'm a Joe
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JBGreat. finally some "micro" after all the "macro". Really appreciate the trade construction advice for the pros and joes.
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GGHi, when was this filmed?
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wbWhat about AED/USD peg or Omani Real /USD peg or QAR/USD peg? Oman probably the weakest link? Qatar probably strongest? UAE/Saudi in the middle? If in UAE you could do very simple trade Borrow AED at 6.25%/annum & convert to USD (better to hold USD in a bank outside UAE). During the embargo of Qatar in 2017, the foreign exchange transfers out of Qatar were limited to 20,000 QAR There was a run on foreign exchange offices I remember, it calmed down after a few months,
Chapters
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The Interplay of Demand Shock, Supply Glut, and Inflationary Monetary Policy
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Who's Fighting Whom in This Price War And Who Has the Strongest Hand?
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Why Are You Trading Saudi Riyal Instead of Russian Ruble?
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What is the Breaking Point for Saudi Arabia?
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The Short $KSA Trade
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Would You Use Options to Short $KSA?
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When Would You Reassess Your View?
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How Would This Fit Into a Shopping List of Energy Longs?
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Price Targets for $KSA