The collision of global markets and social mood

Tuesday, February 25, 2014

Private Equity And HFT Jumping On The IPO Train

Something else to keep an eye on: both TPG (the private equity firm) and Virtu Financial (an HFT firm) are getting ready to do IPOs. Private equity showed an immaculate sense of timing at the 2007 top by rolling out high-profile IPOs such as Fortress, Blackstone, Och-Ziff, and the ill-fated KKR IPO (which had to be cancelled), all of which tanked along with the rest of the market.

The private equity industry was also infamously long real estate to the tune of around $49 billion going into the 2007 top. The fact that TPG (and some others, too) are getting ready to IPO now could make for some interesting timing.

And don't overlook the fact that if parasites like HFT suddenly feel confident enough to an IPO, they must be seeing green for a long time to come.

Yesterday's market action conformed beautifully to the rising wedge scenario put forth here and on my Twitter feed for the last week or so. If correct, the S&P cash should not get below 1824.58 before making a new all-time high. Should this occur, there would be an excellent chance for an important top (if not THE top) to register. 1737 would be the first target below, and it would likely happen quickly. This is why I've been patiently spending so much time and energy stalking UVXY. The last decline took it from roughly 60 to 108 in ten days. I expect much more if everything lines up this time.

1 comment:

  1. Marz,

    do you think decline has started and How are u positioned. are u doing spread uvxy calls. I have march 21st uvxy spread. Do you think its too close. are you following and whats your thoughts on it.