Fri, Sep 17, 2021
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Comment: Why stock market tranquility is unlikely to last

Tuesday, January 03, 2017

Matthias Knab, Opalesque:

Russ Koesterich, Head of Asset Allocation for BlackRock's Global Allocation Fund, writes on Harvest Exchange:

Ideally, the holidays should be calm. Thankfully the market is obliging. Equity market volatility, as measured by the VIX Index, recently dipped below 12, close to multiyear lows. We've seen this pattern repeatedly over the past 10 years and it rarely ends well.

We've been here before, most recently last summer. In late August I described the unusually low level of volatility. By early September the VIX Index had spiked roughly 70% compared to the August low. It repeated the pattern again around the U.S. election in November (see the chart above). We may be setting up for a similar pattern in early '17. Here are three reasons volatility is unlikely to remain this low too far into 2017.

1. Equity investors are alone in their torpor.

While the VIX and other measures of equity market volatility are flirting with historic lows, volatility in other asset classes remains elevated relative to the summer levels. Currency volatility, as measured by the CVIX, remains about 20% above the fall lows. U.S. bond market volatility, measured by the MOVE Index, is off the November high but stays 30% above the October bottom. Only equity market investors are convinced that volatility ......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. SPACs: The fall of the SPAC market has digital media companies in disagreement about best path forward, Cannae Holdings: SPAC bloodbath provides a good entry point, British car startup Cazoo raises $1bn from SPAC merger, Europe's incoming SPAC boom will create a demand for talent[more]

    The fall of the SPAC market has digital media companies in disagreement about best path forward From CNBC: The digital media industry has reached a strategic crossroads. Earlier this year, special purpose acquisition vehicles (SPACs) appeared to be the long-awaited savior of digital me

  2. Property: Real estate's new moneymaker is not design-driven, it's alternative, Two Sigma building quant tools to hunt real estate bargains[more]

    Real estate's new moneymaker is not design-driven, it's alternative From Forbes: There has been a recent shift of attention in the real estate market as to the types of investments which make the strongest returns. In the past, it's always been a combination of good design, prim

  3. PE/VC: Private equity GPs, LPs alike working on diversity and inclusion, Chinese regulator vows to crack down on private equity, venture capital funds, The VC playbook for portfolio companies: learning from the Covid-19 crisis[more]

    Private equity GPs, LPs alike working on diversity and inclusion From PIonline.com: Private equity general partners and limited partners are doing more to increase diversity in private markets, according to a report released Tuesday by the Institutional Limited Partners Association.

  4. PE/VC: Private equity continues to lead fund closings, Venture capital firms are fighting to throw money at cleantech[more]

    Private equity continues to lead fund closings From PIonline.com: Among private fund closings, private equity funds have led the pack starting in 2011, based on data collected by Pensions & Investments. During those years, private equity's share has ranged from 56% to 72% of the total

  5. PE/VC: Climate tech is hot, but VCs can't forget about water, Five top trusts to tap into the private equity boom[more]

    Climate tech is hot, but VCs can't forget about water From Crunch Base: "It is unequivocal that human influence has warmed the atmosphere, oceans, and land." These fiery words come from the latest landmark U.N. report detailing intensifying, universal climate change impacts. They cover