MBS RECAP: Late December Liquidity Leading to Volatility

Posted To: MBS Commentary

Past Friday I explained that bond traders experienced “experienced ample” when it arrived to reacting to every minimal tax invoice headline. That theme held correct currently, but now we may possibly also say that traders have “experienced ample” of lively investing for the calendar year as nicely. In actuality, final week&#039s recap touched on this subject matter in talking about the waning liquidity heading into the finish of the calendar year (i.e. final week was characterized as “final phone” for lively investing ). A extremely liquid marketplace is a bustling marketplace. Late December sees the bustle die down among bond traders. There is nonetheless a great deal of dollars modifying hands, but a significantly bigger share of it is now becoming pushed by unexciting, compulsory factors, like calendar year-finish portfolio adjustments and common hedging activities that don&#039t even sign-up…(read a lot more)

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