BILS - Weekly Commentary: Archegos And Ponzi Finance

April, 05 2021 03:15 AM SPDR Bloomberg Barclays 3-12 Month T-Bill

Archegos provides yet another anecdote that the expansive global derivatives marketplace is at the epicenter of leverage and speculative excess.
From numerous reports, it appears Archegos had fund equity of around $10 billion. Positions have been estimated in the range of $50 billion to $100 billion, meaning a leverage ratio between 5 and 10 to one.
Why would Archegos employ such a risky strategy - basically reckless leveraging of volatile equities exposure? We can only assume the firm was emboldened by the hyper-loose policy and liquidity backdrop.

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Company Name:	SPDR Bloomberg Barclays 3-12 Month T-Bill
Stock Symbol:	BILS
Market:	NYSE