The VIXTLT Index, a new measure of volatility for the US Treasury market, offers insights into bond market nervousness, complementing the widely known VIX for equities. This index is designed to provide investors with a real-time gauge of expected volatility in the US Treasury market, focusing on bonds with maturities exceeding 20 years. Comparing the VIX and VIXTLT can help understand how different asset classes react to market stresses, enabling more informed investment decisions.
The ‘summer of 2024’ began with sporting excitement but ended with global market volatility, fueled by unexpected policy shifts from central banks like the Bank of Japan and the US Federal Reserve. This article analyzes the impact of these events on India’s bond market, highlighting the government’s fiscal outlook, the Reserve Bank of India’s (RBI) policy stance, and potential investment opportunities in fixed-income products.
Goldman Sachs warns that rising bond yields could derail the stock market rally of 2024. The firm believes that when the 10-year Treasury yield crosses 5%, the correlation between bond yields and stocks turns negative, signaling a period of underperformance for equities. The benchmark 10-year yield has already climbed to 4.67% this year, indicating that the threshold may be approaching. Investors are currently in an “optimism phase” of the cycle, but Goldman cautions that the market is becoming increasingly sensitive to moves in bond yields.
