JPMorgan creates index to track Trump tweets’ effect on markets
JPMorgan creates the VOLFEFE Index, which is designed to track the impact of Pres. Trump’s tweets on the markets. With CNBC’s Melissa Lee and the Fast Money traders, Tim Seymour, Carter Worth, Karen Finerman and Guy Adami.
JPMorgan compiles Trump’s tweet influence index
Regular tweets from US President Donald Trump are taking their toll on the country’s bond market. This became especially evident against the background of the trade conflict with China..
In an attempt to quantify the impact of Trump’s tweets on bonds, JPMorgan developed «Volfefe index».
The index got its name from the famous case of 2017, when Trump tweeted with an unfinished thought..
The last word in that publication was «covfefe» — presumably this is a typo from the word coverage.
The bank says the index explains a measurable share of implicit rate volatility movements for 2-year and 5-year treasuries.
Thanks to him, it was also possible to find out that Trump’s messages on market movements are most often related to trade and monetary policy, and use the keywords: «China», «billion» and «products». Such publications are less and less likely to receive a favorable response from the audience of the application and the followers of the president..
Trump has posted more than 10 tweets a day since his election in 2016. Among the publications made during the opening hours of the exchange from 2018 to the present, only 146 actually influenced the market situation..
The days when Trump is particularly active on the aforementioned social network is not uncommon, according to Bank of America. negative stock market return.
«Trade talk, political campaigns, and tweets have contributed to volatility, from China and Fed action to tax policy.», – written by the chief strategist of the brokerage company Savita Subramanian.