Markets have been unnerved by rising interest rates in the US, with ripple effects around the world. The most staggering event has happened on the VIX market with a number of funds/ETNs making the headlines after having lost tons of money. What should investors take from these events ? A couple of reflections and interesting comments seen here and there. Continuer la lecture de « Putting Recent Market Sell-off in Perspective »
Rule of thumb: the more expensive a financial asset is, the lower its prospective return. That’s simple. But sentiment and markets can become and stay irrational longer than investors can stay solvant, they say. So if you cannot predict when the markets will turn, it’s probably better to check where the risks are and monitor them the best you can. And invest with a margin of safety. Always…
Supportive macro backdrop so far makes the case for investing in risky assets, but valuation-wise, harvesting decent returns on a risk-adjusted basis is harder. At least, that’s BofAML’s strategists views.
Answer: it depends on the growth/inflation outlook, less so on the Fed’s balance sheet changes. Per UBS: