Why hedge funds could be making a bond market shock more likely

Impact · against what's priced in

The warnings from the Bank of England and IMF increase the systemic risk profile for financial institutions, specifically those with prime brokerage exposure to leveraged hedge funds. While the high volume of Treasury basis trades is a known factor, the explicit warning that the shift from 'real money' to 'price-sensitive' investors increases shock transmission is a negative catalyst for the financials sector.

Scored by the NIS engine · methodology.

• imf▲1100%
• bank of england
• basis trade
• bond market
• financial stability
• hedge funds
• leverage
• sovereign debt
• treasuries