Hedge funds wary of betting on rates

Managers cite 2013 fixed-income rout as reason for caution

risk0414-in-depth-illo

Before Ben Bernanke’s now-famous warning that the US Federal Reserve might rein in its bond-buying programme last May, hedge funds were among those betting on continued low interest rates. The Fed chief’s comments sparked a mass U-turn and, as a side-effect, revealed a new reality of the fixed-income market – burdened by new rules on capital and leverage, dealers were no longer willing to buy up and sit on unwanted risk positions, with the result that liquidity dropped and prices gapped

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here