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Treasury Bonds

Why Investors Sold Treasury Bonds During the COVID-19 Stock Market Crash?

When stock markets plunge, investors usually rush to buy US Treasurys. But this time was very different. During the COVID-19 stock crash in March and April, investors sold Treasury bonds along with stocks.

According to Chicago Booth’s Prof. Zhiguo He and his colleagues, this phenomenon reflected a new market inefficiency that has its roots in the 2008–09 financial crisis. Something that was introduced as a safety measure after the 2008–09 financial crisis.

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