The first four days in 2016 have been another wakeup call to investors globally that 1) investment grade fixed income assets with duration remain the safe haven when risk is off; 2) the markets are more correlated on the downside; 3) market volatility is back as the Federal Reserve (central bankers to the world) changes its monetary policy; 4) multi-asset approach to diversify downside risks often fails during short term risk off events; and 5) behavioral finance is in full display and we should expect similar reactions to ongoing uncertainties.
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