Nordea: Risk perception index below 80 for the first time in five years
November 21, 2012
- Markets have during the past two weeks been characterized by more clear risk aversion on weak macro data
- EUR swap rates temporarily setting new all-time lows, EUR Senior Financials CDS increasing and EUR dropping below past months trading ranges.
- Nevertheless, implied vol within both rates, equities, FX, and commodities have been marked further down as low-for-even-longer view has been confirmed.
- For the first time in five years, Nordea Risk Perception Index has thus dropped below 80
- The primary drivers for the latest decrease are FX and equities
- Until year end, catalysts for substantial deterioration in risk sentiment are scarce and vols can thus easily loose further grounds.
- Strategies that benefit from markets being kept at bay while having protection against downside risks are still favored.
Please refer to research section of EU.Cbonds to find the full text of the noe.