Nomura Warns, Yesterday's Roughshod Component Subdivision Unwind Is Becoming To A Greater Extent Than Systemic

This seems a rattling sharp [read: it matches around of our thinking] analysis of the electrical current patch of the component division game.
From ZeroHedge:

Yesterday's bloodbath inward markets - later such exuberance on Mon - is gear upwards to piece of job past times on if historical precedents are anything to larn by. Nomura's cross-asset-strategy main Charlie McElligott notes that yesterday’s equities hurting via a brutal factor-unwind resembles 1 of the nearly vehement functioning drawdowns inward recent history - that of January / February 2016 - together with seemingly "idiosyncratic risk" is immediately turning to a greater extent than "systemic" inward crowded Tech "data" plays equally "death-by-paper-cut" immediately becoming a longer-term regulatory overhang of their pith "data commodity."

Worrying words indeed. McElligott commencement breaks downwards only what happened yesterday - together with where the existent "cataclysmic" hurting was felt - earlier moving on to 'what happens next'?

SUMMARY

• The -4.1 z-score movement inward “Cash / Assets” component division - the best performing component division strategy of the past times 2 years - speaks to probable forced capitulation / mass blowouts, similar to what nosotros experienced dorsum inward February 2016 equally “equities market-neutral” functioning was crushed inward a violently-short flow of time
  
• “Cash / Assets” is of import because it is a pure proxy of the “Growth over Value” theme which has been the dominant reality of the post-GFC flow together with has accelerated inward the past times 2 years to look a lot similar “Momentum” factor
  
• The analogs of similarly extreme prior drawdowns inward “Cash / Assets” (again effectively a “Growth over Value” AND human face inward its current-form) plow over us both “good” together with “bad” forward-looking news
  
  • The “good” - said prior “extreme drawdowns” amongst this detail “Growth over Value” proxy ( “Cash / Assets” factor) bring seen mean-reversion HIGHER at the SPX degree on average from a 1w to 3m basis
    
  • The “bad” - “Cash / Assets” component division typically continues to underperform primarily due to the outperformance of the “short” leg from hither (“defensives”)
    
• This so is an equities functioning opportunity because “Cash / Assets” is effectively “Momentum” long-short together with thus, mirrors full general Equities Hedge Fund Long-Short positioning
  
• Further squeeze inward the “short leg” of “Cash Assets” equally good squeezes the “short leg” of “Momentum” via the wide equities fund underweight / brusk inward the “duration-sensitives” similar REITs together with Utilities
  
• This inward plow solely puts MORE clitoris per unit of measurement area on the March CPI impress to “come through” together with hitting the expected uptick off the dorsum of the “Telco Service” roll-off mathematical boost, probable putting rates / USTs dorsum nether pressure
  
• Otherwise, farther rates rally / short-squeeze volition solely perpetuate the hurting beingness felt across equities underweights / short-books
  

...MUCH MORE (the charts are where the activity is)