Experts See Lower Rates As Tailwind For Implied Vol, Yield-Seeking Strategies

Equity volatility watchers say that lower rates in the first quarter of the year should boost implied volatility and yield-seeking alternative strategies. Cem Karsan, founder and senior managing partner at Kai Volatility Advisors, said that a decline in interest rates early in the year will have a counterintuitive effect by loosening constraints on the equity index implied volatility supply.