Posts tagged ‘tail risk’

From the desk of risk: How to Hedge Tail Risk Efficiently

We can give three simple reasons to support the use of volatility products to hedge tail risk in fixed income portfolios. First, equity volatility and bond prices have a strong conceptual link.  If you think of a corporate bond as functionally equivalent to a risk-free asset (like a Treasury bond)…

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Fed Conference in Hotlanta – Turning up the Heat on Too Big to Fail

Last week I had the opportunity to attend the Atlanta Federal Reserve‘s Financial Markets Conference, titled Maintaining Financial Stability: Holding a Tiger by the Tail. This year’s topic – as the pun in the title suggests – was the regulation of financial firms to manage tail-risk events.…

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