The 2009 rebound was driven mostly by steep declines in equity values in 2008 – a dead cat bounce that is not likely to extend into 2010 without company fundamentals improving. Fixed-income investors may be in real trouble heading into 2010. Interest rates are likely to rise as recovery in the US accelerates. What starts as a trickle could turn into a torrent of panic. Fixed-income investors may see the low volatility they have come to rely on fade to distant memory. Commodities, currency and distressed debt are likely to work in 2010. Demand from China and India will continue to drive crude oil prices and base metals higher. Concern over a collapse in the dollar will drive gold, platinum and silver prices. The commodity bubble will re-inflate to the rally cry of $200 crude and $2,000 gold. Global economy uncertainty will mean a field day for currency traders. The propensity for countries to defend their currency will create volatility, which nimble traders will be able to exploit. Increased availability of credit and a stabilizing economy will bolster the corporate balance sheet. Distressed debt investors will enjoy exceptional returns. If you are in the right place, 2010 will be the right time.
Quote from Hedge Funds Review's Article: "Plethora of Strategy Choices for 2010" December 2009 Issue
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