Deutsche Bank stocks as a leverage to increasing bond yields

David's faith

David's faith

I expect bond yields around the western world (did not look too deep into others) to increase sharply. Firstly due to inflation worries, secondly for decreasing demand for bonds on tightening lending standards and thirdly but optionally because of the situation in China which will be a risk off- but also a liquidity shortage event.

I can not say a time horizon and I can not tell which bonds would decrease in price the most but i know one institution that is levered to the teeth all over the globe with derivatives that bet on higher yields. Since I am not a fan of Deutsche Bank as it is more of a hedge funds then a bank due to its massive leverage, this will be the first time ever I go long on this stock. I also find bonds trading odd, so I prefer equities that have the same intrinsics.

If you welcome this information and know a better alternative then buying Deutsche Bank, let me know.
 
Looks like your just fishing for deep value in the banking sector.

If you think that banks stand to capitalize on rising rates, go with a bank that is strong in lending with a good balance sheet. Not a weak bank that has to subsidize a weak capital markets franchise. Currently, American banks have the best balance sheets because GFC reforms curtailed a lot of the business.

Financial's drawdowns over a market cycle are the most brutal.
 
xandman said:
Looks like your just fishing for deep value in the banking sector.

If you think that banks stand to capitalize on rising rates, go with a bank that is strong in lending with a good balance sheet. Not a weak bank that has to subsidize a weak capital markets franchise. Currently, American banks have the best balance sheets because GFC reforms curtailed a lot of the business.

Financial's drawdowns over a market cycle are the most brutal.
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I look at DB as more like an option play on this. Equal chance they'll kill it or go bust and they're way cheaper than the more solid banks with the same exposure.
 
David's faith said:
I expect bond yields around the western world (did not look too deep into others) to increase sharply. Firstly due to inflation worries, secondly for decreasing demand for bonds on tightening lending standards and thirdly but optionally because of the situation in China which will be a risk off- but also a liquidity shortage event.

I can not say a time horizon and I can not tell which bonds would decrease in price the most but i know one institution that is levered to the teeth all over the globe with derivatives that bet on higher yields. Since I am not a fan of Deutsche Bank as it is more of a hedge funds then a bank due to its massive leverage, this will be the first time ever I go long on this stock. I also find bonds trading odd, so I prefer equities that have the same intrinsics.

If you welcome this information and know a better alternative then buying Deutsche Bank, let me know.
More...


They're probably levered on shit that nukes them beyond their (gains from) rate-deltas. I wouldn't touch DB under any circumstances.
 
Sig said:
I look at DB as more like an option play on this. Equal chance they'll kill it or go bust and they're way cheaper than the more solid banks with the same exposure.
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No doubt that the rewards could be big from a turnaround. In a similar vein, I am looking at Petrobras in Oil.
 
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Sig said:
I look at DB as more like an option play on this. Equal chance they'll kill it or go bust and they're way cheaper than the more solid banks with the same exposure.
More...
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Looks like DB bottomed @ $4.99;
too many players + regulators like the FED that dont want a big bank belly up .DB must have plenty of US business or the us FED is interested them anyway.
NOT a prediction, not bank insured:caution::caution: Good daily volume for --7% days drop.:D:D
 
DB chart

It form a mountain peak on May 2007 @153

since then, the highs keep on getting
lower and lower and
lower and lower and
lower and lower and ...

now it is at 9 and is approaching ZERO.
 
maxinger said:
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UPDATED FRI, MAR 24 20236:23 AM EDT
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Dow futures drop 250 points as Deutsche Bank sparks concerns over global banking system: Live updates
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Good points;
but i wouldn't blame a DOW \DIA downtrend on DB+ some old bad bond trades took years to clean up. [Source= old WSJ multi page article full of DB goofs]
Good news /SDOW is going up/ reginal banks also:D:D
 
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