Volatility has returned to the markets in dramatic fashion. The shifting terrain may be jarring for some, but the conditions we are seeing today are more normal than recent years, when investors grew accustomed to record low interest rates, a near-absence of inflation and the subdued volatility. As a more typical environment emerges, our teams are identifying opportunities across asset classes.
In 2018, many positive economic tailwinds set the stage for additional upside in stocks and other equity-sensitive assets, including convertible securities and high yield bonds. However, investors should not be surprised if volatility begins a slow return to its longer-term trend.
As synchronized global growth continues and reflationary tailwinds strengthen, we see additional upside in the global business cycle and in turn, for equities, convertible securities, and select areas of the credit markets.
Scott Becker, CFA, Head of Portfolio Specialists, discusses that even when stocks finish up for the year, drawdowns have been par for the course.
Co-Portfolio Managers David O’Donohue and Jason Hill discuss how convertible arbitrage strategies can potentially capitalize from increased market volatility through gamma trading.
By John P. Calamos, Sr.
Alternative Team Perspectives by David O’Donohue
Global Equity Team Perspectives by Nick Niziolek, Dave Gallagher and Paul Ryndak
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