Investors Are Most Leveraged In History: What Could Go Wrong?

Call option buying is at record levels which, combined all-time high levels of margin debt, means that equity investors are the most levered in history.

This amount of leverage within the context of euphoric investor sentiment and the presence of the pandemic/recession and other potential catalysts suggests that a market retracement could be very sharp indeed.

We’ll start writing the February issue this weekend which will be published in the coming week. There’s no shortage of topics to discuss! We’ll be updating our comments on major markets as well as our investment positions. So far, results for 2021 have been as gratifyingly strong as 2020.

We continue to expect unusual volatility from capital markets in the months and years to come. However, along with the risks that will be presented, we’re even more excited by the investment opportunities we anticipate will appear.

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