Riding the Yield Curve : Risk Taking Behavior in a Low Interest Rate Environment /

Investors seek to hedge against interest rate risk by taking long or short positions on bonds of different maturities. We study changes in risk taking behavior in a low interest rate environment by estimating a market stochastic discount factor that is non-linear and therefore consistent with the em...

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Dades bibliogràfiques
Autor principal: Chami, Ralph
Altres autors: Cosimano, Thomas, Rochon, Celine, Yung, Julieta
Format: Revista
Idioma:English
Publicat: Washington, D.C. : International Monetary Fund, 2020.
Col·lecció:IMF Working Papers; Working Paper ; No. 2020/053
Accés en línia:Full text available on IMF
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100 1 |a Chami, Ralph. 
245 1 0 |a Riding the Yield Curve :   |b Risk Taking Behavior in a Low Interest Rate Environment /  |c Ralph Chami, Thomas Cosimano, Celine Rochon, Julieta Yung. 
264 1 |a Washington, D.C. :  |b International Monetary Fund,  |c 2020. 
300 |a 1 online resource (26 pages) 
490 1 |a IMF Working Papers 
500 |a <strong>Off-Campus Access:</strong> No User ID or Password Required 
500 |a <strong>On-Campus Access:</strong> No User ID or Password Required 
506 |a Electronic access restricted to authorized BRAC University faculty, staff and students 
520 3 |a Investors seek to hedge against interest rate risk by taking long or short positions on bonds of different maturities. We study changes in risk taking behavior in a low interest rate environment by estimating a market stochastic discount factor that is non-linear and therefore consistent with the empirical properties of cashflow valuations identified in the literature. We provide evidence that non-linearities arise from hedging strategies of investors exposed to interest rate risk. Capital losses are amplified when interest rates increase and risk averse investors have taken positions on instruments with longer maturity, expecting instead interest rates to revert back to their historical average. 
538 |a Mode of access: Internet 
700 1 |a Cosimano, Thomas. 
700 1 |a Rochon, Celine. 
700 1 |a Yung, Julieta. 
830 0 |a IMF Working Papers; Working Paper ;  |v No. 2020/053 
856 4 0 |z Full text available on IMF  |u http://elibrary.imf.org/view/journals/001/2020/053/001.2020.issue-053-en.xml  |z IMF e-Library