October 2018 - US credit spreads and Treasuries disconnected in a risk-off environment- Tactical Fund Manager's Comments

14 November 2018

Cédric Daras, Clement Perrette, David Fung, Gilles Pradère, Olivier Mulin

Convertibles Europe 

Global Bond Total Return 

Asia Bond Total Return


In a negative month for risk assets such as October, the classical flight to US Treasuries did not happen, impacting long duration portfolios. The 10-year US Treasury yield grinded higher from 3.05% to 3.15% and the average credit spread on US Investment Grade bonds were wider.


Chart of the month:
US IG Credit Spread vs US Treasury 

RAM TACTICAL monthly chart US IG Credit Spread vs US Treasury

Source: Bloomberg