Markets prepare for more bond and equity volatility

M&G and Aberdeen are predicting volatility in equity and bond markets will continue in the medium term as traders and institutions move to hedge positions in the face of market moves. John Hatherly, head of research at M&G Investments, says there have been four double-digit rallies over the course of the current bear market. The first covered most of the last quarter of 2001, following the September 2001 terrorist attacks in the US. This was followed by markets drifting sideways until a heavy sell off in May in the wake of the Enron and WorldCom accounting scandals. Two more rallies fol...