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Bond rally nearing an end?
- Thread starter gharghur2
- Start date
Goldman selling vol in size. About 5000 March straddles and another 5000 Feb straddles just now. Their position is short about 75,000 straddles total at the 108, 109, and 110 strikes. They want to fade any vol bid on rallies, essentially putting them kind of short outright down to mid 107. From there they are long 35,000 of the 107 strike, and most likely vol would go slightly bid below there.
From Dow Jones:
Bonanza Of Buying In Credit Markets
You name it, fixed income investors are buying it.
Investors are cagey about what to call this exuberance in credit markets, but the seemingly insatiable appetite for bonds, loans and credit derivatives has some murmuring about a bubble in the making.
Only a week after battered Ford announced it would tap the debt markets for $18 billion to help staunch a massive cash bleed over the next several years, the auto maker said it would sell even more.
But itâs not just Ford debt that has investors snapping. They swallowed whole HCAâs $5.7 billion junk bond offering and Freescale Semiconductorâs even larger $5.95 billion deal - both of which funded leveraged buyouts. Even hedge funds are finding willing buyers for their debt.
Credit derivatives are also booming with the notional value of the market reaching $26 trillion. Their popularity with investors who want exposure to the credit markets without having to actually hold a bond has led to the creation of newfangled investment vehicles that allow investors to leverage up to 15 times their principal while enjoying the safety of AAA ratings.
For Mark McClellan, chief fixed income strategist at BCA Research in Montreal, the abundance of easy money is making the credit markets look frothy. âWe are in the early stages of a bubble forming,â McClellan said. âThereâs a wall of cash looking for yield, looking for return,â and itâs swamping the available bond issuance.
Bonanza Of Buying In Credit Markets
You name it, fixed income investors are buying it.
Investors are cagey about what to call this exuberance in credit markets, but the seemingly insatiable appetite for bonds, loans and credit derivatives has some murmuring about a bubble in the making.
Only a week after battered Ford announced it would tap the debt markets for $18 billion to help staunch a massive cash bleed over the next several years, the auto maker said it would sell even more.
But itâs not just Ford debt that has investors snapping. They swallowed whole HCAâs $5.7 billion junk bond offering and Freescale Semiconductorâs even larger $5.95 billion deal - both of which funded leveraged buyouts. Even hedge funds are finding willing buyers for their debt.
Credit derivatives are also booming with the notional value of the market reaching $26 trillion. Their popularity with investors who want exposure to the credit markets without having to actually hold a bond has led to the creation of newfangled investment vehicles that allow investors to leverage up to 15 times their principal while enjoying the safety of AAA ratings.
For Mark McClellan, chief fixed income strategist at BCA Research in Montreal, the abundance of easy money is making the credit markets look frothy. âWe are in the early stages of a bubble forming,â McClellan said. âThereâs a wall of cash looking for yield, looking for return,â and itâs swamping the available bond issuance.
Quote from Surdo:
I caught a really nice ride from the 8:30AM numbers @ 113 '08 exited @ 113 '24.
I am flat, will trade 2 ways next week!
Have a nice weekend.
el surdo
nice. when i saw that spike this morning, i knew there was a large transferrence of $$ to those who had that buy limit set up in the low 113s... thank god i didn't attempt to trade it..
but fade the move looks like the new way to trade, doesn't it?
From Dow Jones:
Bonanza Of Buying In Credit Markets
You name it, fixed income investors are buying it,,,
I recall a similar event in the summer of 1987 when eveybody loaded up on S&P futures and the dollar took a nosedive which caused some unpleasantness.....
with 30% of corporate debt and 45% of treasuries now owned by foreigners, there are likely some itchy trigger fingers around given the dollar is a little airsick these days
Bonanza Of Buying In Credit Markets
You name it, fixed income investors are buying it,,,
I recall a similar event in the summer of 1987 when eveybody loaded up on S&P futures and the dollar took a nosedive which caused some unpleasantness.....
with 30% of corporate debt and 45% of treasuries now owned by foreigners, there are likely some itchy trigger fingers around given the dollar is a little airsick these days
So whats going with the curve today?
L
Lance Carson
Rick Santelli's( CNBC) comments right after the report: "Treasury traders will sell this rally"
Right on target, thank you Rick.
Right on target, thank you Rick.
Quote from Lance Carson:
Rick Santelli's( CNBC) comments right after the report: "Treasury traders will sell this rally"
Right on target, thank you Rick.
since you seem quite experienced here, what ticked you off to selling this thing? i had the impulse to sell it when I saw zb around 113 9/32 ... but decided not to and just stay out.
the currencies rubberbanded back quickly; took the treasuries longer today.