In February, U.S. Treasuries yields have shot up unexpectedly, sending financial markets into a tailspin.
The shift stems from investors’ anxiety from investors about inflation due to the COVID-19 shock followed by the possibility of tighter monetary policy. As a result, volatility, measured by the Volatility Index or the VIX, has shot up from 19.97 in February 12 to 28.89 on February 25.
This signals choppier financial seas, but at Proven, we are accustomed to navigating these conditions. Now is the time to keep an eye on your investment ‘watchlist’, to see if your favorite investments have become cheaper because of all the selling.
These times also remind us that its okay to take some gains off the table when markets are peaking. Key sectors to consider include technology consumer staples, technology and healthcare as the economy gradually recovers.
Our outlook is cautiously optimistic, and we are ready to help you select the winners.