Cross-Asset Strategist & Quantitative Analyst, Pennock Idea Hub

Cam Hui

Cam Hui has been professionally involved in the financial markets since 1985 in a variety of roles, both as a quantitative equity portfolio manager and as a sell-side analyst. He graduated with a degree in Computer Science from the University of British Columbia in 1980 and obtained his CFA Charter in 1989.

Cross-Asset Strategist & Quantitative Analyst

Pennock Idea Hub

We are creators of independent equity research. The Pennock Idea Hub team are veterans of the investment industry. Much of our team has spent their careers at Merrill Lynch, Deutsche Bank, RBC Capital Markets and Wood Gundy. We have taken every aspect of research back to the studs and returned to first principles. The Pennock Idea Hub marries the interests of the sell and buy side. 

We offer the best research for institutional investors by:

-Only publishing research from veteran analysts
-Eliminate the inherent conflicts of the traditional sell and buy side relationship
-Ensure our team is always accessible; collaboration with clients nurtures our collective success

Cross-Asset & Quantitative Research

Thematic (Sector/Industry)

United states / Thematic (Sector/Industry)

<a href="https://thereformedbroker.com/2018/11/26/my-favorite-analogy-for-stocks-vs-the-economy/" target="_blank">Josh Brown</a> had a terrific analogy for the stock market, though he could not claim to be the originator. He characterized the stock market as an untrained and hyperactive Jack Russell terrier leashed to its owner, the economy. Both move in the same general direction, but the dog’s movements are far more erratic and excitable. They don’t have the same temperament and tendencies but over time they move in the same direction.Technical analysis can help with discerning the short-term movements of the dog, and fundamental and macroeconomic analysis gives us insights on the dog handler. Notwithstanding the results of the trade negotiations in Buenos Aires, our analysis of the handler (economy) provides ample evidence that winter is coming.The only question is whether it will be a mild or harsh winter.Two scenarios are possible. If the economy were to avoid a recession under the “mild winter” scenario, we expect stock prices to weaken in 1H 2019, and that should provide the buying opportunity for investors. If the U.S. and China can keep the trade tensions controlled, and the world sidesteps a recession, the mild winter scenario is very much in play.On the other hand, if either the trade conflict deteriorates into a full-blown trade war or the macro data in our set of long leading indicators weakens enough to signal a recession, all bets are off.Under these circumstances, the best course of action for investors is to keep an open mind and become “data dependent”.

Josh Brown had a terrific analogy for the stock market, though he could not claim to be the originator. He characterized the stock market as an untrained and hyperactive Jack Russell terrier leashed to its owner, the economy. Both move in the same general direction, but the dog’s movements are far more erratic and excitable. They don’t have the same temperament and tendencies but over time they move in the same direction.Technical analysis can help with discerning the short-term movements of the dog, and fundamental and macroeconomic analysis gives us insights on the dog handler. Notwithstanding the results of the trade negotiations in Buenos Aires, our analysis of the handler (economy) provides ample evidence that winter is coming.The only question is whether it will be a mild or harsh winter.Two scenarios are possible. If the economy were to avoid a recession under the “mild winter” scenario, we expect stock prices to weaken in 1H 2019, and that should provide the buying opportunity for investors. If the U.S. and China can keep the trade tensions controlled, and the world sidesteps a recession, the mild winter scenario is very much in play.On the other hand, if either the trade conflict deteriorates into a full-blown trade war or the macro data in our set of long leading indicators weakens enough to signal a recession, all bets are off.Under these circumstances, the best course of action for investors is to keep an open mind and become “data dependent”.

2019 Preview: Winter Is Coming