Download PDF What are the Basel Agreements? Financial risks have long been observed and studied, but it was only in 1974, with the failure of West Germany’s Bankhaus Herstatt, that central bankers became aware of and decided to act on settlement risk. For these very purposes, the Bank of International Read more…
Download PDF Introduction The perfect storm of harsh macroeconomic conditions and geopolitical uncertainty has taken its toll on the markets. 2022 saw widespread selloffs across all asset classes and is considered to be one of the worst years on record for investors. Although the equity markets have fared worse through Read more…
Download PDF US On Monday, equities finished a little lower after the rally caused by the weaker-than-expected inflation reading last week. Interest rates moved lower with the 10-year U.S. Treasury yield down from 4.15% to below 3.9%. Markets overall moved sideways in expectation of more consumer data coming out during Read more…
Download PDF US On Monday Meta announced that it planned to lay off thousands of people as early as Wednesday. Despite this, its stock price jumped by 3%. Apple stock, on the other hand, fell by 1% because of warnings that it might produce three million fewer iPhone 14 than Read more…
Download PDF Introduction In 2022, rates traders have had to navigate a landscape of deteriorating liquidity in sovereign debt markets. Over the past few years, there have been multiple episodes of severe illiquidity in US Treasuries and related markets. Firstly, US repo rates spiked in September 2019, with intraday secured Read more…
Download PDF New Zealand as the trendsetter New Zealand saw its Inflation rate persistently over 5.5% between 1975 to 1990, with multiple years of inflation at or above 12%. However, starting from 1991, a sharp drop to around 1-2% is observable. One of the main drivers is the Reserve Bank Read more…
Download PDF US The month of October ended with the Dow Jones recording its biggest monthly percentage gain since 1976. However, these gains soon evaporated as all US major indexes ended the week down following the 75bp increase in interest rates by the Fed and a mixed job report on Read more…
Download PDF Introduction Stock prices forecasting is a deeply researched topic, which has been enhanced by the use of Machine Learning techniques since the late 90s. In this article, we present the main methods and models employed by the current literature, along with our own proprietary model. Literature Review Over Read more…
Download PDF Introduction The mid-term elections are general elections which are held approximately at the mid-point of every US president’s 4-year term. This year they will be held on November 8th. Mid-term elections serve to select which party will take 33 or 34 out of the 100 seats in the Read more…
Download PDF US Major US indices performed well this week despite intra-week turmoil, particularly in the Nasdaq 100 and Nasdaq Composite. Russell 2000 showed the largest increase, topping last week’s close by 6.0%, with the Russell 3000 Value performing better (+5.1% WoW change) than the Russell 2000 Growth (3.2% WoW Read more…
Download PDF Introduction: Fixed Income Markets Performance High inflation and rising interest rates have governed the credit markets in 2022. Year-to-date, high yield bonds are down approximately 16% and investment grade bonds are down approximately 23%. The 2022 macroeconomic environment has wiped away the strong recovery seen by the credit Read more…
Download PDF Introduction In 2022, the number of IPOs has plummeted to lows comparable to post-financial crisis levels after the highs of 2021 with individual deal values falling due to lower valuations. In September, the number of US IPOs was a mere 20% of the ones in the same period Read more…
Download PDF Introduction The term “Liability Driven Investment”, also known as LDI, covers investment policies with the goal of covering current and future liabilities of the investor. As such, it is not a benchmark-driven investment strategy since it does not need to outperform any benchmark, but rather only needs to Read more…
Download PDF Introduction The current macroeconomic landscape is shaped by high inflation, increasing interest rates, and growing risk aversion. The diverging realities nations are facing due to the Russia-Ukraine war, the ensuing energy crisis, the COVID-19 pandemic, the looming global recession, and more, are putting policymakers’ decisions in the limelight. Read more…
Download PDF USA On Monday, the ISM Manufacturing PMI for September came in below expectations at a level of 50.9 against the consensus estimate of 52.2. This also marked the lowest level since May 2020. This reading supported stocks and bonds at the beginning of the week as markets interpreted Read more…