This was kind of an under-covered story yesterday, but yesterday, Donald Tsang, Hong Kong’s Chief Executive, denied any plans to repeg the Hong Kong Dollar to the Chinese yuan, away from the US dollar.
In fact, he specifically said that Bill Ackman — who is famously betting on such a repeg — would lose money!
Well the market reacted.
USD/HKD volatility (basically a measure of investor betting that the US dollar would fall against the Hong Kong dollar) collapsed yesterday, back to where Ackman entered the trade.
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