JP Morgan strategists have stated that investors should start preparing for the turmoil in the financial markets. According to the news of Financial Times, JP Morgan strategists say that global markets are ‘unusually’ quiet ‘for a long time, and that investors should start preparing for turmoil on the market.
JP Morgan Global Head of Research for Quantitative and Derivative Products Marko Kolanovic told that risky assets such as stocks rallied for years and volatility is approaching record low levels. The financila experts of JP Morgan explained that the volatility in the fundamental sense should not be high, however it seems clear that the current macro environment does not guarantee the lowest volatility at all times.
Strategists have come to the conclusion that the monetary expansion of Japan and the European Central Banks has come to an end and that the fundamental factors supporting the Fed’s high valuations with interest rate hikes have been lifted. Marko Kolanovic said that in such kind of a market environment, turbulence will increase volatility and cause tail risks in the medium term.