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In this paper, we identify and document the empirical characteristics of the key drivers of convertible arbitrage as a strategy and how they impact the performance of convertible arbitrage hedge funds. We show that the returns of a buy-and-hedge strategy involving taking a long position in...
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) "internationalization" of the currency; (ii) currency convertibility; and (iii) reserve currency status. Their sequencing in relation to … attaining full convertibility or meeting other prerequisites for achieving reserve currency status. Ultimately, China will … proceed with capital account convertibility in its own controlled and gradual manner, with the goal being an open capital …
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Impossible trinity in China -- Opening a can of worms -- Betting on the role of the state -- Incentive problem standing in the way -- Power struggle or genuine reform -- From financial repression to liberalisation -- Monetary policy reform fraught with risks -- Systemic risk (I): shadow banks...
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