Top 8 Trades For 2015, Via Goldman Sachs
Here Are Goldman Sachs's Top Trades for 2015
The release of Goldman Sachs (GS) top trade ideas for the year ahead is an annual staple. Whether you think these are power trades or not, the time has come for this year's release.
Last year, of the six it suggested, "four were in the black, one was in the red, and one a little better than a draw."
Following the release of its big themes for the year, here's the rundown for 2015:
#1 - Get set for a further slide in the euro (FXE)
The bank forecasts EUR/USD to fall to 1.15 over the next 12 months, in equal parts a reflection of its dollar bullish view and euro bearish outlook. "Position for the downside via a one-year 1.20/1.15 put spread for around a 4.5 to 1 potential maximum payout.
#2 - Buy 10-year U.S. Treasurys with yields above 3% but not below 2% (TLT)
The bank expects 10-year U.S. Treasurys, currently yielding around 2.3%, to trade at or above 3.0% by next June.
#3 - Long a Dec-2015 Eurostoxx 50 'bull' call spread (FEZ)
Economists see scope for a pick-up in euro area growth in 2015 that is not reflected in market prices yet.
#4 - Long U.S. High-Yield credit risk (JNK)
The recent underperformance of the U.S. High-Yield market should prove transitory, the bank reckons.
#5 - Long an equity basket of emerging market crude oil importers (EEM)
The slide in oil does have benefits.
#6 - Sell the Swiss franc (FXF) against the Swedish krona
A monetary policy divergence play.
#7 - Short copper (JJC) against nickel
Position for copper underperformance relative to Nickel via Dec-15 LME futures, says the bank. This would be a way to play the theme of "supply differentiation" as copper enters a once-in-20-year supply cycle, resulting in above-trend supply growth.
#8 - Long dollar (UUP) against a basket of the South African rand and the Hungarian forint
Courtesy of WSJ.com