Industrials Starting to Lose Their Edge Auto Demand Takes a Step Back The Rent Narrative May Get Messy Bank Loans, Munis and TIPS on the March Total Return & Issuance Recap View PDF
Investors’ demand for equities, namely of the global and thematic variety, has reached an extreme relative to the safety of U.S. Treasuries. It will be ‘global synchronized growth’ for investors in 2021.
Summary U.S. Treasury yields look poised to inch higher and higher under little enthusiasm or fanfare. U.S. Treasuries have recommenced their slow grind to higher yields after a brief respite to end January. 10-year yield’s brief flirtation with dipping below 1.0% did little to entice buyers. We have argued the lower implied volatility remains along …
In today’s installment, Ben outlines the next set of hurdles needed to signal a lasting rise in inflation expectations.
In today’s installment, Jim and Ben discuss extremely low real yields and some of the oddities occurring within inflation expectations.
The blue wave has ignited a jump in nominal Treasury yields, while real yields refuse to follow along. The Federal Reserve’s new AIT framework suggests dovish policy will persist in the face of rising inflation (if it really happens). TIPS breakevens have already produced record high Sharpe ratios, but have room to run according to risk assets.
In today’s installment, Jim and Ben discuss the biggest surprises across a wild year of asset returns in 2020. Bigger picture, 2020 was the year of trading with the Federal Reserve, which may not be repeated in 2021.
Summary Travel, Energy and Materials Dominated Q4 Excess Returns Credit, Equity Divergence in the Energy Sector The Automotive Industry Looks for a Fast Start to 2021 Regional Banks in Focus Total Return & Issuance Recap View PDF
Over 50% of flows into ETFs over the final three months of 2020 were directed into global and inflation-friendly assets. Global synchronized growth better show up in 2021!
U.S. 10-year TIPS look poised to become the shining star of 2020 with a Sharpe ratio of 1.26. In fact, TIPS have not taken the top spot according to Sharpe ratios since 2002.