FYI: Investors are coming up with new ways to hedge credit risk as interest rates rise and the Federal Reserve appears to be on course for further tightening with minutes from its last meeting scheduled to be released Wednesday.
Amid a steep run-up in Treasury yields and the longest selloff in the S&P 500 Index since the 2016 election, traders are largely avoiding risk. But they’re ignoring the traditional yin-yang relationship between defensive and cyclical stocks, as well as between longer- and shorter-dated Treasury bonds.
Regards,
Ted
https://www.bloomberg.com/news/articles/2018-10-16/etf-investors-are-rewriting-the-rules-for-interest-rate-hedging
