Institutional Insights: Goldman Sachs Tactical Flow of Funds 13/12/24
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GS Tactical Flow-of-Funds: The Twelve Days of Flows
a. We are entering the best seasonals of the year for US equities, and the bar for being bearish right now remains high with 12.5 days to trade.
b. The flow story has been the major driver in 2024. Below is a rundown of supply and demand.
c. I am looking to fade the equity market in the second half of January as the risk of overshooting remains high. S&P Lookback Put trade ideas available.
Eleven Trillion passive flow-ing: Current Passive AUM = $11.773 Trillion. US equities logged +$186 Billion worth of inflows over the last 9 weeks, the largest inflow on record. Money is flowing into US equities since the 2024 election. This is the largest 9-week inflow since $144 Billion since February 2021.
Liquidity is also super strong right now, with top book liquidity ~$34M, heading into quarterly roll period.
Current assets under management in money markets is $ 9 Trillion. Money Markets saw +$992 Billion worth of inflows YTD, best on the board. Does any cash, any at all, move? If a mere (ZZZ) ~1% moves out of money markets, that’s $90 Billion worth of rotational flow.
We are entering the 3rd best two-week period of the year since 1928 (DEC 2H) Followed by the best two-week period of the year since 1929 (JAN 1H).
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Patrick has been involved in the financial markets for well over a decade as a self-educated professional trader and money manager. Flitting between the roles of market commentator, analyst and mentor, Patrick has improved the technical skills and psychological stance of literally hundreds of traders – coaching them to become savvy market operators!