Most of the time when stocks go up, bonds go down, and when stocks go down, bonds go up, but this fall has been interesting. It's been a scary several couple of months for risk-averse investors, but many hedge funds and institutional investors have been cheering the return to volatility, especially this month.
Q3 hedge fund letters, conference, scoops etc
Over the last three trading sessions, the S&P 500 has bounced up and down dramatically, as have the NASDAQ 100 and the Dow Jones Industrial Average. The major U.S. stock indices ended last week with a bout of widespread selling, but that has reversed course again today with all four indices rebounding dramatically in early trade this morning.
Flight to safety or contrarian signal for stocks?
Amid all this volatility, Barclays strategist Emmanuel Cau and team said in a recent note that investors have continued their flight to safety. Mutual funds have been selling both stocks and bonds and allocating toward cash instead, and investors continued the trend.
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