Kepler's Dowling: Stress-testing US equity trusts

Covid a real life stress test

clock • 4 min read
Pascal Dowling, partner, Kepler Trust Intelligence
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Pascal Dowling, partner, Kepler Trust Intelligence

Anyone who has been paying attention since the Great Financial Crisis in 2008 will be familiar with the concept of a ‘stress test’.

Becoming a part of the public consciousness in the wake of the crash, these tests - held by the Bank of England every year and by comparable institutions abroad - are designed to ensure that the banks are sufficiently sturdy to withstand another financial crisis. As well as helping to ensure that the banks themselves maintain sufficient safeguards to avoid catastrophe, a useful side effect of these tests is that the public are reassured about the safety and stability of the banking system - something which, in itself, contributes to that stability. As somebody who bought shares in a p...

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