It is funny how fear becomes infectious and eventually clouds rational people's judgement.
Five or six years ago, no-one ever mentioned counterparty risk to me, now they apparently cannot stop talking about it. If I had a pound for every adviser or investor who has written to me about their counterparty terror, I would be a very wealthy man by now. The latest missive on the subject came last week from a very smart IFA who asked whether it was safe to buy into synthetic ETFs, followed by a question about whether I thought the French banks were about go belly up. Only a few days before, a very sophisticated private investor – with connections to the hedge fund community – wrote...
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