This is terrible. Utterly bad timing. Having highest level of equity exposure near market peaks.
https://city.wsj.com/articles/6acdd08c-8f2a-4fdc-89fa-61a5719fa8ec
Key Facts
https://city.wsj.com/articles/6acdd08c-8f2a-4fdc-89fa-61a5719fa8ec
Key Facts
- Computer-driven volatility-targeting funds generally scoop up riskier assets like stocks during calmer periods.
- When volatility hits, it sends them scrambling to sell their stocks.
- At the same time they move into safer assets like Treasurys.
- Asset managers like Vanguard Group and insurance companies run some of the bigger strategies of this type.
- Volatility-targeting funds had an estimated 44% equity exposure last Tuesday.
- That was their highest level of equity exposure since early October, said Wells Fargo Securities.