Whats Driving Increased Bond Market Volatility?

The video discusses the recent increase in market volatility as the Federal Reserve plans to end its bond purchases and potentially raise interest rates. This has led to uncertainty among investors about whether to invest in riskier assets. High yield bonds have seen significant swings, with some firms seeing them as a good buy due to high yields, while others are cautious about a rising rate environment. Despite expectations, yields have fallen, defying predictions and contributing to market volatility. The Federal Reserve and long-term Treasury investors have benefited, while some hedge funds have suffered. The global economic outlook appears weaker, with concerns over oil prices and Ebola.

What is the Federal Reserve expected to do next week that could impact market volatility?

• Introduce new stimulus programs

• Stop quantitative easing

• Lower benchmark rates

• Increase bond purchases

Why are investors uncertain about riskier assets?

• Due to falling oil prices

• Because of rising inflation

• Uncertainty about interest rate hikes

• Concerns over global growth

What unexpected trend in interest rates is contributing to market volatility?

• Interest rates are falling

• Interest rates are fluctuating

• Interest rates are stable

• Interest rates are rising

Which type of investment has performed well despite market volatility?

• High yield bonds

• Short-term Treasurys

• Long-term Treasurys

• Commodity-focused hedge funds

What recent global concern is mentioned as affecting economic predictions?

• Rising inflation

• Political instability

• Trade wars

• Ebola outbreak