Briefing
Sovereign CDS Dealers as Market Stabilizers
Abstract: Economists at the Richmond Fed analyze the role of dealer-provided liquidity in sovereign credit default swap markets. Using newly available data from the Depository Trust and Clearing Corporation, they track the positions held by large dealers during crises in Ukraine, Venezuela, and Argentina. The researchers find that large dealers tended to increase their provision of insurance as risk increased during those episodes — a finding that is consistent with the notion that they tend to act as market stabilizers during times of turmoil.
Access Documents
File(s):
File format is application/pdf
https://www.richmondfed.org/-/media/richmondfedorg/publications/research/economic_brief/2020/pdf/eb_20-13.pdf
Description: Article
Authors
Bibliographic Information
Provider: Federal Reserve Bank of Richmond
Part of Series: Richmond Fed Economic Brief
Publication Date: 2020-12
Volume: 20
Issue: 13
Pages: 6 pgs.