Author: Nathan J. Rowader
May 15, 2017
Category: Quantitative Insights
Our Observations: The 10-year Treasury ended the week at 2.33%, inside the 30 basis points range that has held for much of the year. It appears that the appetite for risky assets, i.e. stocks and credit, has returned after the minor sell-off in April. We also remain in a historically low level of market volatility. We think it is often difficult to navigate these periods of uncertainty, as history tells us the low levels of volatility should give way to high-pressure selling. However, periods of low volatility may deliver potentially strong returns while everyone waits for the change in market risk. In these times, we think it is important to stay vigilant and rely on risk management practices to guide portfolio construction.