Manage risk and volatility in high-yield markets with Eurex High Yield Index futures
Volatility in the Euro high yield segment has soared as Europe gradually exits a decade of ultra-low rate environment. Inflationary pressures leading to higher borrowing costs caused Euro high yield credit spreads to widen in 2022. This surge in volatility and perceived risk have increased the need for hedging. For market participants invested in sub-investment grade bonds, particularly buy-side firms, this poses both challenges and opportunities. Strategic tools are necessary for effective risk management in this inherently risky market. Euro High Yield Index futures are a derivative product that can help mitigate and manage these risks. Firms invested in high-yield markets can use these instruments as part of an targeted investment strategy to respond effectively to market volatility and help gain a competitive advantage.
Learning Objectives:
- Understand the implications of the increased risks and volatility within the Euro high yield markets over the past year
- Quantify the challenges and opportunities inherent to the Euro high yield markets in a volatile environment
- Examine how utilizing Euro high yield index futures can help hedge against market risks
- Integrate this new product into a wider investment framework within the high-yield markets
Speakers
Antony Harden
Equity Futures/Delta 1 Sales Trader
Goldman Sachs
Mahesh Bhimalingam
Chief European Credit Strategist
Bloomberg
Bodha Bhattacharya
Portfolio & ETF trading
Goldman Sachs
Davide Masi
Fixed Income Derivatives Product R&D
Eurex
