The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2020 Euromoney, a part of the Euromoney Institutional Investor PLC.
Fintech

Katana sees relative value survive the bond market convulsions

Now an independent firm outside ING, Katana is upgrading its algos and scanning more bonds for correlation trades between pairs not normally linked.

plant-crack-resilence-asphalt-780.jpg



As June drew to a close, with equities selling off on fears of a second wave in China and increasing cases in the US and Germany, the new supply of investment-grade and high-yield corporate bonds was slowing down sharply, after the rush to issue into the great rally driven by central bank buying.

Analysts were sending notes of caution.

Matthew_James_Citi-160x186.png

Matthew James,
Citi

Matthew James, head of global spread products research at Citi, told investors: “We remain positively inclined across spread products as we move into summer, given the tail-end of the QE wave. However, markets could get choppy as liquidity drops into the holidays.”

Suggesting that the surge of central bank liquidity has crested, James said: “We believe that investors should take advantage over the next few weeks to tidy up portfolios – lighten up on less-confident positions, bolster liquidity buffers and tactically add to core views.”

It’s not just overall credit spreads that have been extraordinarily volatile during the past four months.




You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree