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As British rate expectations parted ways with central bank guidance, short-dated U.K. government bond yields began to rise more quickly than longer-dated ones.
As British rate expectations parted ways with central bank guidance, short-dated U.K. government bond yields began to rise more quickly than longer-dated ones.
(iStockphoto)

VIX, small caps send serious warning signal to investors

The relative performance of U.S. small market capitalization stocks and the CBOE Volatility index should move in opposite directions because they’re essentially measuring the same thing in inverse ways – investor risk tolerance. But right now, the VIX is stable while small cap stocks drastically underperform the large cap benchmark. This might constitute a serious warning sign for equity investors.