Low Volatility Favours 'hunt For Yield' But Warning From IMF

Published 11/03/2017, 07:25 AM

Volatility has continued to fall, as central bank predictability is considered high and the macroeconomic outlook looks increasingly stable.

We argue that this bodes well for continued focus on 'carry' or 'hunt for yield' strategies.

'Hunt for yield', ECB QE and a solid budget surplus also mitigate the upside pressure on German long yields from the macro economy.

The IMF warns that 'financial products tied to equity volatility [bought] by investors such as pension funds are creating unknown risks that could result in severe shock to financial markets'.

To read the entire report Please click on the pdf File Below:

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