Next frontier for credit traders: shorting volatility

摘要

Betting on markets remaining calm has long been a popular, though risky, trade in finance. Now, a growing number of banks is looking to bring such strategies to corporate credit markets, the last major asset class where so-called short volatility trades are rare. JP Morgan updated its credit volatility index earlier this year with an eye on bringing systematic credit volatility strategies to a wider audience, spawning an exchange-traded fund launch in late March.