The Fed's intention to potentially taper QE by 2014 has triggered another massive sell-off in assets that have previously been supported by easy money, according to Charlie Aitken, Managing Director at Bell Potter. The biggest losers are US 10-year bonds, gold and the Australian Dollar. Australian equity markets are expected to be extremely top-down driven in the next few months with high levels of cross-asset volatility. Any stock which has previously been supported by low bond yields will experience selling pressure. Aitken recommends shorting REITs, gold and AUD while banks and QBE remain in his high conviction-buy portfolio.
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