Possible scenario
De-Risking Extends
25% Chance
A less benign outcome is that the pension imbalance confirms broader institutional de-risking after the sharp rise in bond yields. Additional selling from risk-parity, volatility-control, or discretionary macro accounts keeps pressure on equities for another session.
Initial impacts
- Riskier companies' borrowing costs Up
- Market volatility Up
- 10-year Treasury yield Down
- US dollar Up
Secondary impacts
- Consumer Cyclicals -1.1%
- Finance -1.1%
Portfolio impact
S&P 500-1.0%
Each figure is the modeled move of the S&P 500 if the outcome occurs. For information only. Not investment advice.
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