Liz Ann Sonders Says Markets Ignore FX Volatility

The video discusses the recent spike in FX volatility, noting that while it is at a yearly high, it remains below long-term averages. The impact on asset classes like the S&P 500 is minimal, with historical data showing limited correlation between FX volatility spikes and significant equity market losses. The discussion shifts to current market dynamics, highlighting the stronger dollar, flat yield curve, and ongoing Fed rate hikes. Investors are advised to consider defensive strategies as market risks increase, with a focus on value over growth stocks. The video concludes with a cautious outlook, acknowledging potential volatility and risks but not signaling the end of the secular bull market.

What does the JP Morgan's FX volatility index indicate about the current state of currency volatility?

• It is at the lowest point in the last decade.

• It is at the highest point in the last year.

• It is at an all-time high.

• It is below the long-term average.

How has the US equity market historically responded to spikes in FX volatility?

• It has always outperformed other markets.

• It has generally performed well.

• It has shown increased volatility.

• It has consistently suffered significant losses.

What is one of the factors mentioned that could be different in the current economic context?

• A weaker dollar.

• A rising yield curve.

• A decrease in central bank interventions.

• A stronger dollar.

What investment strategy shift is being observed in the current market environment?

• A shift towards more defensive sectors.

• An increase in growth stock investments.

• A move towards high-risk assets.

• A focus on emerging markets.

What is the outlook on the secular bull market according to the transcript?

• It is dead and buried.

• It is expected to continue without volatility.

• It is likely to experience more volatility.

• It is transitioning to a bear market.