MBS convexity hedging: back with a vengeance, or ghost story?

More bonds now sit with active hedgers but market is split on whether flows can move US rates again Back in the early 2000s, the US rates markets were at the mercy of mortgage-backed securities (MBSs). The holders were active hedgers and as underlying rates moved, it led to a flood of trades that could have an impact on the markets underpinning them.As these MBSs passed into the hands of passive, non-hedgers like the Fed post-2008 and then after the Covid pandemic, that effect dimmed. But as Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe You are currently unable to print this content. Please contact info@risk.net to find out more. You are currently unable to copy this content. Please contact info@risk.net to find out more. Copyright Infopro Digital Limited. All rights reserved.You may share this content using our article tools. As outlined in our terms and conditions, https://www.infopro-digital.com/terms-and-conditions/subscriptions/ (clause 2.4), an Authorised User may only make one copy of the materials for their own personal use. You must also comply with the restrictions in clause 2.5.If you would like to purchase additional rights please email info@risk.net Sorry, our subscription options are not loading right now Please try again later. Get in touch with our customer services team if this issue persists. New to Risk.net? View our subscription options If you already have an account, please sign in here. Most read articles loading... Back to Top