https://risksandreturns.com/category/interest-rates/ In search of asymmetric trading opportunities… en-US https://risksandreturns.com/2008/10/15/covered-short-position-in-us-treasury-bonds/ https://risksandreturns.com/2008/10/15/covered-short-position-in-us-treasury-bonds/ Wed, 15 Oct 2008 11:23:31 +0000 Today I covered my short position in the December contract of 30 year US Treasury bonds futures at $113.89. I initially sold the contract last Thursday for $118.29. This was only a small short term trade to play some lessening of fear after the US and Europe announced they would recapitalize the banking system. Although today’s stock market plunge seems to indicate that the market remains as fearful as last Friday, Treasury bonds have taken the hit that I expected. This may be due to concern about the huge supply of bonds that the US government will have to issue to finance all these bailouts. https://risksandreturns.com/2008/10/13/shorting-us-treasury-bonds/ https://risksandreturns.com/2008/10/13/shorting-us-treasury-bonds/ Mon, 13 Oct 2008 11:19:06 +0000 Last Thursday I shorted 30 year US Treasury bonds futures which trade on the Chicago Board of Trade. I sold the December contract for $118.28. This is only a short-term trade based on my belief that the plan for governments around the world to directly recapitalize banks, guarantee interbank lending, and provide a blanket guarantee on all deposits would be enough to prevent a total financial system meltdown and restore confidence in banks. https://risksandreturns.com/2008/10/12/the-credit-market-panic-will-soon-subside/ https://risksandreturns.com/2008/10/12/the-credit-market-panic-will-soon-subside/ Sun, 12 Oct 2008 11:06:38 +0000 The credit markets have come to a standstill as evidenced by the skyrocketing TED spread. This is the difference in rates between three-month LIBOR and three-month T-bills and is a gauge of how fearful banks are to lend to one another. https://risksandreturns.com/2007/08/01/a-credit-crunch-in-a-highly-leveraged-economy/ https://risksandreturns.com/2007/08/01/a-credit-crunch-in-a-highly-leveraged-economy/ Wed, 01 Aug 2007 19:35:04 +0000 The collapse of the subprime mortgage market has caused fixed income investors to demand higher risk premiums from not only all grades of residential mortgage-backed securities, but also commercial mortgage-backed securities, corporate bonds and debt from emerging markets. https://risksandreturns.com/2006/09/22/the-bond-rally-may-be-ending-soon/ https://risksandreturns.com/2006/09/22/the-bond-rally-may-be-ending-soon/ Fri, 22 Sep 2006 12:10:36 +0000 Treasuries are on pace for the largest weekly advance in 17 months. The 10-year yield has fallen to 4.6%, the lowest level since March. https://risksandreturns.com/2006/08/23/the-coming-bear-higher-rates-part-1/ https://risksandreturns.com/2006/08/23/the-coming-bear-higher-rates-part-1/ Wed, 23 Aug 2006 17:43:38 +0000 This is the first in a series of posts, titled ‘The Coming Bear’, that will analyse where the economy is headed. The final post in this series will look at some investment ideas that should do well if the future plays out the way I see it.