15/04/2025
6 minute read
On April 2, known as Liberation Day, President Trump announced the US administration's tariff policies. The market reaction that ensued was unprecedented. We examine and compare green bonds and traditional bonds’ volatility in the European and US investment grade corporate bond markets.
There is a prevailing market maxim that green bonds display less volatility than traditional bonds.
Following the strong market reaction to the US Government's tariff policies, we took the opportunity to test the theory.
While we found no conclusive evidence to support green bond preference due to indiscriminate selling in the market, there was lower volatility in the form of lower beta in Europe's green bonds.
The automotive sector is a leading candidate for a meaningful green transition
Transition leaders evidence outperformance in second half of 2025
We consider how emissions are allocated to green bonds.
In this report, we show how green negative basis packages are a strategy to drive relative funding costs for green bonds tighter.
Low carbon credit relative returns have recovered after an extensive oil price rally.
EIGPRL is effectively Aramco exposure following the bonds inclusion on the ESG CEMBI index.
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