"The risk premia are very difficult to incorporate because risk premia are responding to geopolitical, responding to trade tension," Warjiyo told a panel in Bali.
|
|
"Risk premia are rising across the euro area," said Schamotta.
|
|
There's little to suggest those volatility premia will come down.
|
|
"I take less of a signal from the downward moves in market-based measures of inflation compensation...these more likely reflect changes in liquidity premia and inflation risk premia rather than changes in inflation expectations," she said.
|
|
The whole idea was to take term premia out of the long bond.
|
|
We aim to stimulate growth by lowering real interest rates and risk premia.
|
|
A bearish sterling view would be reflected in a greater premia for 'puts'.
|
|
S. trade, and could crimp economic growth, dampen capital inflows and raise risk premia.
|
|
Sim said Air Premia had signed up for long-term servicing agreements with Boeing.
|
|
Average premia on emerging sovereign dollar bonds tightened six basis points to 4.841 bps.
|
|
Still, despite the higher risk premia, the fundamental outlook remains positive, the firm said.
|
|
SIGNIFICANT UNCERTAINTY, LOW GROWTH COULD LEAD TO REPRICING OF RISK PREMIA IN FINANCIAL MARKETS - ESRB
|
|
On external debt, sovereign emerging debt yield premia to Treasuries slipped to 3903-day lows.
|
|
"Against such a backdrop, investors would be right to demand higher risk premia," he said.
|
|
There is great uncertainty, and uncertainty translates into risk premia both in economies and financial markets.
|
|
And by lowering credit and liquidity premia, corporate bond purchases are an efficient means of providing stimulus.
|
|
"We think of valuation as a function of growth and risk premia," the Winter-led team wrote.
|
|
Morgan Stanley analysts had warned risk premia would increase in Colombian assets if the law was overturned.
|
|
If we were to act, we will aim at lowering real interest rates and narrowing risk premia.
|
|
It's really a question of if you downgrade growth, downgrade inflation expectations, your Fed expectations and risk premia.
|
|
Economic and political uncertainty increased volatility and risk premia on the financial markets at the end of 2018.
|
|
Brazil's real slumped 40 percent last year around S&P's September downgrade and its premia over Treasuries doubled.
|
|
It would seem to be increased fears of recession risk that is resulting in rises in risk premia.
|
|
Policymakers also warned, however, that any doubts about the government's economic reform agenda could push up risk premia.
|
|
Powell said it was difficult to accurately determine expectations in financial market pricing because term premia affect those rates.
|
|
A reversion to the mean: Term premia will normalize and yields will get back to their long-term averages.
|
|
When term premia is taken into account the difference between the two sets of predictions is much smaller, Powell said.
|
|
"The bottom line is risk premia and uncertainty remain high for the U.K.," Bradshaw told CNBC's Squawk Box on Tuesday.
|
|
Powell said things that move longer end include term premia, expectations for short rates and also buying on risk aversion.
|
|
For full report click here Term premia dropped to historic lows - here Reporting by Marc Jones; Editing by Andrew Heavens
|
|
"Despite all the challenges, there doesn't seem to be any imminent catalyst for wider spreads or rising risk premia," said Leung.
|
|
"This could considerably impact global premia and the direction of the flow of metal in the World ex-China," it said.
|
|
"Risk premia should remain elevated as the market grapples with U.S. policies, with Asia in particular risk from protectionism," he noted.
|
|
Controlling expenditures reduces Brazil's risk premia, lowers interest payments and instills confidence in credit ratings agencies and international investors, they said.
|
|
The survey said these investors were adding to their allocation of hedge funds and opting for "risk premia" and "smart beta" products.
|
|
"The German banking system has become more vulnerable to an abrupt increase in risk premia and thus in interest rates," Buch said.
|
|
Libor and its premia over risk-free interest rates are often seen as a barometer of the health of the banking system.
|
|
"With Warsh, that pricing should drop and result in higher term premia as the hurdle for more QE gets hiked," Goncalves said.
|
|
According to the survey, 81 percent of respondents are currently investing in, or looking to invest in, risk premia and smart beta solutions.
|
|
Recent research-driven adjustments to the purely systematic process have led to the introduction of alternative risk premia and improved drawdown management techniques.
|
|
Turkish dollar bond yield premia over Treasuries were at 556 bps, rising above those of countries such as Nigeria, Ghana, Angola and Iraq.
|
|
"The answer to this will reset the level of risk premia, or risk tolerance for other asset prices," Caron said in a note.
|
|
Italy's 10-year bond yield premia over Germany has tumbled almost 200 basis points from highs above 300 bps reached late last year.
|
|
Amato has managed alternative investment portfolios and led the group's alternatives research team, which focuses on hedge funds, liquid alternatives and risk premia strategies.
|
|
In a presentation to lawmakers, Campos Neto warned, however, that risk premia and inflation could rise if the government's economic reform process is derailed.
|
|
"For yields to materially rise, we would have to believe there's an inflation impulse that returns term premia back to the curve," said Caron.
|
|
Long-term mean reversionNormand's third strategy for market timing is simple: Buy credit, stocks, commodities, and emerging markets when risk premia are extremely high.
|
|
The real has weakened against the dollar in recent weeks despite signs economic growth is picking up and a decline in Brazilian risk premia.
|
|
"The uncertainty that the (election) result brings means that you have a degree of the risk premia re-establishing itself," said Barclays strategist Hamish Pepper.
|
|
"At some point, this passive loss of duration will begin to exert increasing upward pressures on the term premia," Praet told an audience in London.
|
|
The deal follows an agreement to lease three 787-9 jets from Air Lease Corp as Air Premia prepares to start flying in September 2020.
|
|
Emerging stocks rose 0.5 percent while emerging sovereign dollar bond yield premia to Treasuries have compressed to 356 basis points, the lowest in three weeks.
|
|
The rouble fell 60 percent in the six months before its first cut to junk and Russian dollar bond premia over Treasuries rocketed 500 basis points .
|
|
"The discussions around trade are simply not helpful when it comes to the risk premia for auto companies - and that's not helpful for valuations," said Weidenbach.
|
|
"This means absolutely no risk premia are being priced into account for the fallout from the virus," said Richard McGuire, head of rates strategy at Rabobank.
|
|
The 274 Aston Martin DB22015GT was auctioned at R.M. Sotheby's annual London sale on Wednesday evening which saw a total of £22015 million change hands (including buyer's premia).
|
|
Italian, Spanish and Portuguese bonds have been among the bloc's best performers over the past year, and yield premia — or spreads — over benchmark German debt have narrowed relentlessly.
|
|
While elevated, financial credit spreads are also "far from distressed levels", but "the re-introduction of systemic risk premia would materially erode the outlook for credit," Himmelberg added.
|
|
CdR recently added a team specialized in so-called risk premia, a quantitative investment technique that attempts to capture returns above various market indexes based on historical patterns.
|
|
Chief Executive Peter Sim described Air Premia as a "hybrid" airline offering greater comfort than low-cost rivals but lower fares than domestic giants Korean Air and Asiana .
|
|
Rolls, which competes with General Electric on the 787, offered Air Premia a "cutting edge" financial deal, Sim said, adding he was confident it would overcome recent snags.
|
|
"The main triggers that could unearth a disorderly increase in risk premia relate to both domestic and external factors," the ECB said in a biannual Financial Stability Review.
|
|
HONG KONG, Oct 30 (Reuters) - South Korean carrier Air Premia has signed a provisional agreement to buy five Boeing 787-9 Dreamliner jetliners, industry sources said on Wednesday.
|
|
"Under monetary policy divergence, U.S. dollar funding premia in the currency swap market could easily spike higher," Nakaso told a meeting of the International Bankers Association of Japan.
|
|
Citi also projects assets under management in smart beta and risk premia hedge funds will rise from $265 billion in 2014 to $1.2 trillion by the end of 2019.
|
|
That's reflected in equity risk premia - the excess returns stock market investments offer over government bonds - of 190 basis points, versus a long-term 120 bps average, UBS says.
|
|
The euro is also widely used as risk premia are lower, funding is cheaper and locals working in Western Europe tend to send home cash in euros, swelling deposits.
|
|
Encouraged by the premia paid this season, farmers may plant more non-GM soy in the next cycle, according to Daniel Ferreira, the superintendent of agricultural research agency Imea.
|
|
But several investors told Reuters there was no panic in the markets as the Milan bourse only lost 24 percent while bond yield premia over safe-haven benchmark Germany narrowed.
|
|
The firm has previously advocated for diversifying to so-called alternative risk premia, which refer to factors that hedge funds and other sophisticated investors employ for strong risk-adjusted returns.
|
|
"A possible frustration of expectations regarding the continuation of reforms and necessary adjustments in the Brazilian economy may affect risk premia and increase the path for inflation," Copom's statement said.
|
|
If you look at M&A premia that we see in the insurance sector, it's typically 25 – 40 percent and clearly Generali's share price has not moved that much as yet.
|
|
Risk premia is an investment style that aims to create a premium for the amount of risk involved and smart beta looks at benefiting from market inefficiencies in a transparent way.
|
|
"Risk premia across (Brazilian) assets remains relatively low compared to past episodes of stress, which make us reluctant to add risk at current levels," wrote Morgan Stanley strategists in a note.
|
|
Emerging bonds have likewise rallied strongly, with dollar bonds' average premia over U.S. Treasuries declining by around 103 bps over the week, pushing spreads to the lowest in over a year.
|
|
The Bank of Mexico described how rating agencies downgraded Mexico's sovereign risk outlook from stable to negative and, in turn, sovereign risk premia and medium and long-term interest rates rose.
|
|
"A quicker than expected U.S. policy normalization and a subsequent appreciation of the U.S. dollar may trigger an abrupt and broad increase in risk premia on emerging market financial assets," it said.
|
|
The central bank has taken risk premia out of the market and now it's starting to come back in and now we're seeing a correlation starting to reverse between stocks and bonds.
|
|
This premia has been pushed down since the global financial crisis because of strong demand for bonds from central banks, pension funds and insurance companies that tend to buy and hold bonds.
|
|
"The recovery could be derailed by a sharp rise in risk premia, triggered for example by a re-escalation of trade tensions, or a further spread of the coronavirus," the Fund said.
|
|
That should tighten Portuguese and Spanish 10-year yield premia over Germany to 50 bps and 60 bps, respectively, over the next year from the current 75 bps or so, they said.
|
|
That should tighten Portuguese and Spanish 10-year yield premia over Germany to 50 bps and 60 bps, respectively, over the next year from the current 75 bps or so, they said.
|
|
A benign euro zone backdrop did, however, help compress yields on other euro zone debt, with French yield premia over Germany falling this week to the lowest in 2-1/2 year lows.
|
|
Shares of British engine manufacturer Rolls Royce were trading more than 1% higher after the company announced a deal with Korea's Air Premia that will see the firm make engines for its jets.
|
|
The report offered two reasons why investors are fleeing into illiquid assets: to earn the higher return premia that illiquid assets offer, and most prominently, to escape the volatility of stocks and bonds.
|
|
That said, long-term risk premia in the bond market would not fall as much because Warsh would be less prone to embark on QE to combat a recession or a financial crisis.
|
|
We've seen obviously stock prices going down, some risk premia are going up, so some tightening of financial conditions globally starting with the US. But it all depends on how the situation will evolve.
|
|
Economists said Copom trod a fine line between acting to fight the mushrooming crisis, and not going too far for fear of weakening the currency even further and fueling inflation expectations and risk premia.
|
|
The BIS said this time though markets' reaction function may have been complicated by exceptionally low 'term premia' - the extra return investors demand to compensate for the risks associated with holding long-term bonds.
|
|
"Continued risk premia compression and signs of increased risk-taking behaviour in financial markets are sources of concern as they may sow the seeds for large asset price corrections in the future," the ECB said.
|
|
"A scenario where interest rates increase, for example due to increased risk premia... could put debt sustainability and, as a consequence, financial stability at risk," the European Systemic Risk Board said in its annual report.
|
|
LONDON, July 13 (Reuters) - Emerging stocks touched new eight-month peaks on Wednesday and dollar bond yield premia versus Treasuries were just off one-year lows amid a worldwide investor dash for higher-return assets.
|
|
"A possible frustration of expectations regarding the continuity of these reforms and adjustments may affect risk premia and increase the path for inflation over the relevant horizon for the conduct of monetary policy," Copom said.
|
|
Assets rose mainly in "alternative risk premia", an automated investment style, but also thanks to the launch of a $400 million European credit product and modest flows into computer-driven and discretionary long-only funds.
|
|
He said there were questions about what happens to the flows of foreign financing because of uncertainty about Britain's economic prospects - whether the funding becomes shorter in duration, or reflects increased risk premia in British assets.
|
|
"Chinese companies are willing to pay a higher price for quality European assets, with average premia paid for a European listed target during H1 reaching 23.5 percent, up from 13.5 percent in 2015," the report said.
|
|
Earlier on Thursday, the central bank more than halved its growth forecast for this year and, aside from pension reform uncertainty that could put upward pressure on risk premia, outlined a relatively benign outlook for inflation.
|
|
Investors may get increasingly nervous if the European Central Bank's ultra-low rates stay in place for an extended period, increasing the chance of a sudden increase in risk premia, Bundesbank President Jens Weidmann said on Friday.
|
|
"The pound is set to continue depreciating, but the rise in sterling risk (premia) and short speculative positioning now suggest a slower pace of depreciation," said Petr Krpata, chief EMEA FX and interest rate strategist at ING.
|
|
On Friday, Jens Weidmann, president of the German central bank, warned that an extended period of ultra-loose policy from the European Central Bank (ECB) might increase the risk of a sudden jump in risk premia, Reuters reported.
|
|
Renewed political uncertainty (Germany is currently in a political impasse and Brexit negotiations are far from concluded) is also seen as a potential trigger to higher risk premia, thus potentially increasing borrowing costs for both governments and companies.
|
|
"At the beginning of the year the market was only concerned with the EU referendum date, around the summer, but the market was not implying any risk premia toward this EU summit," said ING currency strategist Petr Krpata.
|
|
"The dollar's rise has not been accompanied by higher risk premia," Campos Neto said, noting that the dollar's rise to 4.20 reais was partly a global move and partly a result of Brazilian firms paying down foreign debt.
|
|
"Similar to our views pre-Brexit, we believe the already high levels of risk premia embedded within equities coupled with the improving global economic backdrop should help to cushion any significant downside if Trump were to win," Barclays said.
|
|
The taxes, collected nationally, could be passed on in part, or in full to the EU, especially if they were generated directly by EU policies — like revenues from auctions under the Emissions Trading System or emission premia for cars.
|
|
Average yield premia offered by emerging local bonds over U.S., eurozone and Japanese government debt is around 5.4, 7.2 and 7.1 percentage points, according to Salman Ahmed, chief global strategist at Lombard Odier, who is advising investors to reconsider emerging markets.
|
|
Premia on ETFs tracking high-yield corporate debt shot up when the ECB said in March 2016 it would buy corporate debt under its stimulus program, and fell significantly around the Brexit vote and the U.S. presidential election later that year.
|
|
Among risk factors that have led to a discount on domestic assets or boosted risk premia, "those related to the credit rating of Pemex, and even to Mexico's sovereign debt, are particularly noteworthy," the bank said in its post-meeting statement.
|
|
The premia offered on the Tier 1 and Tier 2 debt range between 22.7% and 42.3% above where most of the bonds had been trading in the last month, a chunky premium for a bond tender in a challenged bank.
|
|
"We consider this to be a risk because it entices market participants to ignore fundamentals, and particularly downside risks, which means that risk premia are too low to compensate for future drawdowns," said Raphael Gallardo, strategist at Natixis Asset Management.
|
|
Yet it's a leftfield risk at the back end of a year that some of the world's major money managers told Reuters only last week they had virtually removed the substantial euro political risk premia built up over 12 months ago.
|
|
Policymakers noted that the economy is operating with a high degree of slack and that inflation is easing, but warned that the high level of uncertainty surrounding economic and fiscal reforms is putting upward pressure on risk premia and inflation.
|
|
"The lack of rand risk premia is also at odds with a similarly large number of potential risk events on the international calendar, to which rand is particularly vulnerable given its sensitivity to shifts in broader U.S. dollar sentiment," Nomura said.
|
|
Since the ECB can buy no more than one-third of a country's bonds, this is accepted as a monetary policy tool aimed at reducing the term premia, or the premium investors demand to hold longer dated debt over shorter papers.
|
|
BRASILIA, Sept 26 (Reuters) - Brazil's central bank is closely watching the foreign exchange market, its president Roberto Campos Neto said on Thursday, adding, however, that the real's recent slide against the dollar has not resulted in risk premia in financial markets.
|
|
Premia on ETFs tracking high-yield corporate debt shot up when the ECB said in March 2016 it would buy corporate debt under its stimulus programme, and fell significantly around the Brexit vote and the U.S. presidential election later that year.
|
|
"The margin was, however, extremely narrow (700 votes) and the Conservatives were a fairly distant third, so we don't expect GBP to find much relief from the recent rise in political risk premia," said Adam Cole, strategist at RBC Capital Markets.
|
|
The risk premia demanded by investors to hold Argentina's dollar bonds over safe-haven U.S. Treasuries rocketed to 2,534 basis points on J.P.Morgan's index of hard-currency emerging market bonds - levels last seen in the wake of a major 2001 default.
|
|
However, asset purchases are an imperfect substitute for lower interest rates, as they transmit a spending impulse to the economy via different channels (wealth effects, reduced risk premia) and the impact of asset purchases – a relatively new tool – is far more uncertain.
|
|
On the other hand, (ii) a possible frustration of expectations regarding the continuation of reforms and necessary adjustments in the Brazilian economy may affect risk premia and increase the path for inflation over the relevant horizon for the conduct of monetary policy.
|
|
Oil prices have since recovered to above $60 per barrel after crashing down to about $30 at the start of 2016, though Shah projected the recent rally would probably "lose steam for the rest of the year" amid fleeting political risk premia.
|
|
LONDON, March 14 (Reuters) - Russian dollar-denominated bonds came under pressure and yield premia widened on Wednesday after Prime Minister Theresa May said Britain would retaliate against Moscow in response to a nerve toxin attack on a former double agent in southern England.
|
|
BRASILIA, March 23 (Reuters) - The coronavirus pandemic will deliver a hefty demand shock to Brazil's economy, but worries over economic reforms and rising risk premia limited the central bank's interest rate cut last week to 50 basis points, meeting minutes showed on Monday.
|
|
Risk premia for both countries have improved in 2019, but the advantage Mexico once enjoyed over Brazil has narrowed, due to a blend of rhetoric, results and expectations about their two presidents as they approach nearly a year in power, analysts say.
|
|
"For the second half of the year, we aim to improve our safety performance, increase production volumes and deliver on our full-year 700 million rand cost-savings target while continuing to achieve optimal market premia," Chief Executive Officer Themba Mkhwananzi said in a statement.
|
|
"From now on what really matters is that the political risk premia have declined and this will allow the market to start focusing on a number of fundamental developments and I think these are positive on the euro," Gkionakis told CNBC on Sunday evening.
|
|
"Risks to EU financial stability are assessed to have remained at elevated levels," the ESRB said in the document, listing as its main concerns the mispricing of risks by financial operators and their possible repricing of premia as growth slows and interest rates remain low.
|
|
"Escalation (of trade tensions) is a sort of impossible thing to forecast, but if it stops at this level you have probably created some nice risk premia in Asia and emerging markets," said Hans Peterson, global head of asset allocation at SEB Investment Management.
|
|
On bond markets, local Asian debt made some gains with Thai 10-year yields at 15-year lows and Indian yields at two-month lows, but sovereign dollar bond premia were at the highest in nearly seven years after rising 20163 basis points on Tuesday .
|
|
"Now that we are starting to get more clarity on the political landscape, that political risk premia should begin to compress and bond outflows of recent months could start to reverse, helping to buoy Thai bonds," said Duncan Tan, strategist at DBS Bank in a note.
|
|
"With some of the mega M&A deals, there is no doubt there is a pipeline (of issuance)...most of the M&A will be to a large extent debt-funded," PGIM's Farley said, though he noted new issue premia for some recent bonds had been "punitive".
|
|
"High investor demand and the search for higher yields, which have been a major source of the CRE price increase, particularly in prime markets, have potentially made investors vulnerable to a repricing of risk premia," the ERSB said, without citing any specific figures to back its argument.
|
|
"Continued compression of risk premia, subdued volatility and signs of increased risk-taking behavior in global financial markets are all sources of concern, as they may sow the seeds for large asset price corrections in the future," the ECB outlined in its Financial Stability Review report.
|
|
"While some sectors and asset classes are less sensitive than others to tightening cycles, interest rate rises are accompanied by lower risk premia, inferior industry returns, smaller rewards from many factor-investing strategies, and reduced price appreciation for a wide variety of real assets," the authors write.
|
|
We endorse a competitive free market in which health insurers make risk assessments that will yield the lowest premia required by competitive insurers to compensate for risk, and this price information will in turn provide guidance regarding the cost of government subsidization, including Medicare and Medicaid.
|
|
"Risk premia across (Brazilian) assets remains relatively low compared to past episodes of stress, which make us reluctant to add risk at current levels," wrote Morgan Stanley strategists on Tuesday, adding that they will only consider adding exposure to Brazil if the real falls to 4.20 per dollar.
|
|
"Global factors such as a dovish Fed, declining term premia and tightening credit spreads are driving emerging market asset outperformance making it harder to access specific risks," said Bryan Carter, head of emerging market fixed income at BNP Paribas Investment Partners, whose team manages $1.2 billion in funds.
|
|
" Mark Carney: "There is some tentative evidence of tariffs having an impact on trade flows (...) but there is not yet that much evidence of an actual, a hit in business confidence as translated into less investment, I'm speaking globally, or big risk premia going into financial markets more broadly.
|
|
"We've obviously seen stock prices going down, some risk premia going up, so some tightening of financial conditions globally, starting with the U.S. But it all depends on how the situation will evolve and that's certainly what we don't want to see — a general tightening of financial conditions," he said.
|
|
While a combination between Italy's number one (Intesa Sanpaolo) and number two life insurers would inevitably raise competition concerns, Rivaldi posited that the 2012 merger between Unipol and Fondiaria Sai – which required the shedding of some premia but led to notable cost savings – set a positive precedent for working around anti-trust issues.
|
|
"While the summit is unlikely to be immediately consequential for markets, the reduction in tail risks related to North Korea's nuclear weapons program could help reduce risk premia over the medium term, and help refocus investor attention on strong earnings and global economic fundamentals," said Mark Haefele, UBS Wealth Management's chief investment officer.
|
|
"I was not in favor of the resumption of net asset purchases at this time because I thought that further purchases are unnecessary right now - I stress 'right now' - given the very low levels of both long-term interest rates and term premia," Villeroy said in a speech at the Paris School of Economics.
|
|
"I was not in favour of the resumption of net asset purchases at this time because I thought that further purchases are unnecessary right now - I stress right now - given the very low levels of both long-term interest rates and term premia," Villeroy said in a speech at the Paris School of Economics.
|
|
"I was not in favor of the resumption of net asset purchases at this time because I thought that further purchases are unnecessary right now - I stress 'right now' - given the very low levels of both long-term interest rates and term premia," Villeroy said in a speech at the Paris School of Economics.
|
|