Perspectives
Navigating Volatility: Bond Price Discovery Using Fixed Income ETFs
Dustin Lewellyn, Chief Investment Officer of Kalawa Capital Management,
believes during times of extraordinary volatility in the financial
markets that fixed income ETF’s offer greater pricing discovery than
individual bonds. “While individual bonds trade in a veiled
over-the-counter market,” say Mr. Lewellyn, “fixed-income ETF’s trade
on-exchange, like equities. As a result, fixed-income ETF’s reflect
real-time pricing since shares of fixed-income ETF’s generally trade
more often than their underlying bonds, even in calm markets.”
