With praises from market commentator Marc Faber, Byron Wien and Anthony Scaramucci, I had to snap up a copy for my own study and reference given the lack of books on global macro investing. I have to say that this particular one from money manager Greg Gliner is a neat, prescient and useful guide on the art of this relatively-enigmatic trait.
The book is structured to give an overarching view of the global macro investor’s framework and concepts, as well as the tools of the trait; hence, it’s designed like a hands-on manual or tutorial that is for the practitioner rather than the theorist.
These are a list of subjects covered in a topical format in Gliner’s book, in two main parts:
Overview of Global Macro:
- Overview of Global Macro Strategies
- Trading Process, Sizing Trades & Monitoring Performance
- Back-tests, Queries & Analogs
- Building blocks of Global Macro Trading (Equities, Fixed Income, Foreign Exchange, Commodities)
- Technical Analysis
- Systematic Trading
Global Macro Trading Foundation:
- Foreign Exchange in Global Macro
- Fixed Income
- The Role of Central Banks in Global Macro
- Economic Data Releases and Demographics
The overview portion essentially deals with the basics of the process of global macro investing. Without delving too much into details, Gliner talks about both discretionary and systematic strategies, and describes the trade processes that includes performance measurement as well as risk management. I particularly found the section on query building and monitoring performance useful. One of Gliner’s suggestions is to include a ‘conviction level’ field into one’s trading/investing log. This could help in identifying personal biases when trading. As a discretionary investor, this is something that can help me to improve my performance. As quoted:
“Let’s assume a 0-10 scale, where 0 is no conviction and 10 is the highest conviction. If, for instance, a pattern emerges where you are making money on most of your lower-conviction trades (5-6 score) and losing money on your high-conviction trades (8-10), this could be indicative of a confirmation bias. Conversely, if you are consistently losing money on your low-conviction trades, perhaps you should stick to high-conviction ideas.”
The second portion goes into the main concepts about the various asset classes/product groups that global macro investors tend to trade with. The author talks about the basics about bonds, credit, equities, currencies and commodities; details of instruments/derivatives and valuation metrics of each product group are also covered. For this portion, experienced investors may not want to spend too much time working through it. I personally found the section on commodities particularly enlightening, whereby Gliner broadly explains the supply and demand drivers and even provided tables of crop calenders for major agricultural commodities.
The reference section at the end of the book is also useful for serious readers to explore further.
One pretty neat feature about Gliner’s book that differs from other professional investment books thus far are Bloomberg shortcuts that are provided at the end of every chapter! The author provided shortcuts for functions that are related to the topic covered for readers to use them when on their Bloomberg terminals/accounts. This is really useful for those are unfamiliar with some of the available shortcuts or are exploring more functions to maximise Bloomberg’s functionalities.
However, if you are looking for a detailed book that dives straight into the process of the art of global macro or something more technical in nature, this book may not fit the bill. I’ll be reviewing another book that goes into further detail on the global macro investing process and philosophy soon – stay tuned!
Overall, highly recommended for interested investors who are beginning to explore the art of global macro!
For readers based in Singapore, you can get this book from Fishpond.com or via Wiley (Bloomberg Financial Press).
*cover image taken from Amazon.com*