Global Bonds Slide $1 Trillion
The problem is simple, suppressed vol allowed vol targeting strats to lever up but when vol spikes, these strats are forced to rebalance (i.e. sell).
Here's what Bloomberg had to say earlier today:
The capitalization of a global bond-market index slid by $450 billion Thursday, a fourth day of declines that pushed the week’s total above $1 trillion for only the second time in two decades, Bank of America Merrill Lynch data show. Global stocks gained $1.3 trillion in the same period. Yields o
