U.S. | Heightened Bond Liquidity Risk is the New Normal
Published on Thursday, September 3, 2015 | Updated on Friday, September 4, 2015
U.S. | Heightened Bond Liquidity Risk is the New Normal
Summary
Regulations and high frequency trading are the culprits of new liquidity dynamics. Banks’ role as market-makers is challenged by buy-side investors. Fed normalization will ease but not eliminate existing limitations on liquidity. E-trading distorts reliability of common liquidity measures
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Authors
Shushanik Papanyan