How to Model the Impact of an Interest Rate Rise Using Axioma’s Multi-Asset Class Tools

Global interest rates have been decreasing for the past 15 years, reaching record low levels.  An interest rate increase by central banks will likely result in a turning point for interest rates overall, hence the growing anxiety among investors.  The U.S. Federal Reserve has been signaling the market for some time that an interest rate increase is imminent.  This white paper explores the potential outcomes of a central bank’s interest rate policy action on a broad-based portfolio consisting of various assets.

 

By Philip Jacob, Melissa Brown & Diana Rudean