We are positioning our ultra-short and short-term bond portfolios with the goal of not only navigating rising rates but also ultimately benefiting from them.
The last time we wrote about the US dollar London lnterbank Offered Rate (LIBOR) was in 2016, when the spread between LIBOR and the Overnight Indexed Swap (OIS) rate increased due to market dislocations leading up to US money market fund reform. Now in early 2018, we have seen LIBOR rates rise and LIBOR-OIS spreads widen again, causing us to ask the same question — what’s up with LIBOR?
David was the King of Israel and the writer of many of the Psalms. He spent his formative years as a shepherd and framed his life’s work around the key concepts from his profession. Herds were the primary form of wealth back then, while common stocks are a primary form today.
When we were kids, we used to love having our parents read to us, especially from books written by Lewis Carroll. Through the Looking Glass and Alice in Wonderland were our two favorites. One of the quotes that has always stuck with us is, “Down the rabbit hole,” which is a metaphor for an entry into the unknown, the disorienting, or the mentally deranging, from its use in Alice's Adventures in Wonderland. Unfortunately, the same can be said about the stock market recently.
EM ETFs suffered deviations in their market prices relative to their net asset values, with their total returns materially underperforming the broad emerging market index.
Blackstone is pleased to offer the following Market Commentary by Byron Wien which shares his thinking on global economic developments, market insights and other factors that may influence investment opportunities and strategies.
As the recent market volatility made clear, there’s a big difference between plain vanilla ETFs and leveraged products making big bets with big risks.
Fixed income exchange-traded funds (ETFs) saw a record $126 billion of inflows in 2017, bringing the overall market to nearly $600 billion. The majority of these flows, as well as existing assets under management, are in passive bond ETFs. But are passive, index-tracking approaches the best way to harness the fixed income opportunity set?
Most central banks have targets, too. And judged solely by the numbers, monetary policy would be assigned a substandard rating.
One of the most important discoveries in finance over the past few decades is that stocks of firms that share certain fundamental characteristics called “factors” exhibit different return and risk characteristics than the overall market.