While the term may mean little to your average retail investor, swap spreads havebecome the talk of financial markets in recent weeks as they plumb historic lows and seemingly defy market logic.
“The volatility market that exists today is much more complex than it used to be; ETFs, indices, futures, and options traded on all of the above have complex relationships that haven’t been fully tested,” George Pearkes, analyst at Bespoke Investment Group, said in an interview.
Has anyone been dealing with this or have any interesting thoughts on this stuff? I didn’t realize it was going on
The explanation in the BBG article regarding clearing of swaps makes sense. Other explanations I´ve heard were corporate issuance and UST sales pressure from China.
EDIT: Just saw that all of these are named in the second BBG article. So obviously I am only as informed as the rest of the world
