2 min readInsight on the economy and your cash portfolio At the end of last year, we published a Quarterly Cash Update which provided a recap of the markets in 2023 and discussed the possibility that we had reached an inflection point in which interest rate cuts would begin in 2024. As we begin Q2 of 2024,…
2 min readRecap and insight on the economy and your cash portfolio in 2023 After continuous increases in interest rates by the Federal Reserve (“the Fed”) since March 2022, it seems we may have reached the inflection point and that the Fed may begin interest rate cuts starting in 2024. Watch our latest Quarterly Cash Update to…
10 min readExecutive Summary Effective liquidity management, especially for large cash portfolios with a range of investments, can quickly turn into a larger and more complex task than initially expected. Some financial executives may not have a firm grasp of what liquidity means in a portfolio of individual cash assets. But adhering to some simple guidelines and…
9 min readWhat Led to The Bank’s Eventual Closure and What Lessons Cash Investors Can Learn From This to Minimize Portfolio Risk On March 8th, Silicon Valley Bank (SVB) announced a significant balance sheet restructuring and an associated $2.25 billion capital raise to shore up the bank’s financial position after rising rates and significant deposit outflows severely…
7 min readThe History of the Fed’s Quantitative Tightening (QT) and its current standing The Fed’s history with Quantitative Tightening (QT) is both limited and perilous. Its only prior experience with Quantitative Tightening in 2018-2019 ended in disaster, when funding markets locked up in September 2019 due to a lack of available liquidity. This episode is infamously…
1 min readWatch the webcast: Click the above webcast link for episode 2 of Credit Update. Hosted by Capital Advisors Group’s Director of Investment Research and Strategy, Lance Pan. Topics covered: Recap of what happened to prime funds in March 2020 Overview of characteristics that make prime funds poor candidates as “liquidity” vehicles Overview of government assistance…
17 min readDOWNLOAD FULL REPORT Abstract After sudden shareholder redemptions in March stressed money market funds, it became clear that several rounds of reforms since the 2008 crisis have failed to bolster institutional prime money market funds as liquidity vehicles. While extraordinary government measures once again helped to stabilize the market, they should not be recurrent policy…
1 min readWatch the webcast: Click the above webcast link for episode 1 of Credit Update. Hosted by Capital Advisors Group’s Director of Investment Research and Strategy, Lance Pan. Topics covered: Recap of Recent Market Events How to Balance Credit Risk in a Portfolio During Times of Economic Volatility (e.g., COVID-19) Overview of Corporate Paper (CP) Bid-Ask…
2 min readAfter three interest rate cuts since July, the Fed signaled last month that it finally expects to take a breather, with no more moves for a while. But that only means we have to start wondering what may come next. Will the recent spate of positive economic news prompt the Fed to reverse course and…
12 min readDOWNLOAD FULL REPORT Abstract The pause by the Fed after three rate cuts removes some near-term uncertainty for short-term interest rates. On balance, we think the economy faces more headwinds than tailwinds, and thus the probability of further cuts is significant enough to warrant some portfolio readjustment. A yield curve that is no longer inverted…