Buy Volatility Ahead of a Jam-Packed 'Policy Month,' Says BofAML
The central bank calendar is about to get heavy.
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It's time to position for the end of that peaceful, easy feeling that's enveloped markets this summer ahead of a month fraught with event risk, says Bank of America Merrill Lynch.
"We remain 'cynically bullish' on financial asset prices," writes a team led by Chief Investment Strategist Michael Hartnett. "Tactically, the 3P’s (Positioning, Policy, Profits) still argue for upside; but with risk assets up 15-20 percent since Feb, and Sep a big 'policy month' we once again recommend buying volatility."