Money For the Rest of Us When Volatility Spikes, Financial Things Break - The Case of UK Gilts and Pensions
What is volatility and what causes it to rise and fall? How volatility itself contributes to more volatility such as in the example of the chaotic UK government bond market where long-term yields have increased by 4% in 2022.
Topics covered include:
- How the role of volatility has changed in financial markets
- What caused UK interest rates to spike and long-term bond investors to lose 50%
- What is liability-driven investment
- What drives increases in volatility and volatility spikes and spillovers are more frequent
- How to earn income from shorting volatility and what are the risks
- What we can learn when financial securities blow up
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Show Notes
The volatility virus strikes again by Eric Lonergan—Financial Times
UK government debt and deficit: December 202—UK Office for National Statistics
Markets are more fragile than investors think by Robin Wigglesworth—Financial Times
What Caused the Volatility “Volmageddon” on 5-Feb-2018 by Vance Harwood—Six Figure Investing
Investments Mentioned
WisdomTree CBOE S&P500 PutWrite Strategy ETF (PUTW)
Simplify Volatility Premium ETF (SVOL)
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159: What You Need To Know About Volatility
283: Why You Should Care About Carry Trades
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