IVOL News and Press, Quadratic Interest Rate Volatility and Inflation Hedge From 05/11/21

Treasury Secretary Yellen is sticking to the Fed’s prediction that inflation will be “transitory.”. Wednesday’s ADP report created giddy expectations of one million or more total jobs created in April, counting all sectors, but the Labor Department reported...

Volatility returned to government bond markets in April, amid a flood of central bank decisions and noteworthy economic data. The largest movement came from the Portuguese 10-year government bond, whose mid-yield surged by nearly 27 basis points to close at 0.49%, the highest level si...

This past week, market action was sloppy as investors are finding fewer reasons to push stocks higher. Over the last few weeks, we have seen numerous companies report stellar earnings growth. We are continuing to run a "barbell" approach to portfolios by overweighting our inflatio...

This article looks at 150 years of inflation data from multiple countries, to find correlations and causes. An assessment of whether CPI is accurate, and where it may be off. How different asset classes perform in inflationary/deflationary environments. For further details s...

Banks have begun to withdraw credit from non-financial sector borrowers, meaning they will lack the finance to process and deliver goods to meet increasing demand. Commodity prices are now rising strongly, which so far is believed by market optimists to indicate recovering demand and,...

There's no shortage of indicators to monitor for deciding if the expected runup in inflation is a temporary affair or regime shift that signals a longer-term rise in pricing pressure. The term premium (TP) is one of the three main components for decomposing Treasury yields. The other ...

Fed action usually comes with a lag, as money released into the banking system in the form of QE takes time to work its way into the real economy. Annualized inflation has been rising steadily since March 2020. T-note futures have only been able to manage an anemic sideways correc...

Because absolute valuations are high by historical standards, stocks are generally vulnerable to multiple compression should there be even a hint of unchecked margin pressure, let alone earnings disappointments. Even a modest rate of inflation could have a substantial negative impact ...

Although large negative real yields have become the norm in core Europe, they were less common in the US. Covid-19 changed that. The re-opening should change that back, but so far it hasn't. A big payrolls report followed by a near-4% inflation number next week should tip the balance....

While many yields are at, or near, their historic lows, opportunity remains in select segments of emerging-market debt, triple B-rated corporate bonds and certain areas of the mortgage-securities market. A good way to approach value stocks has been to find those that are attractively ...