Category Archives: Bonds

TOTD: Today’s Rare Market Feat

This would be the 4th time in 20 years that stocks, bonds and gold all up by > 0.25% on the Fed Chair’s semi-annual testimony.  – Sentimen Trader (TOTD = Table of the Day)

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2017 First Half Key Takeaways

Bonds  Big outperformance by local emerging markets and Euro periphery in first half.  Last week was pivotal as some bonds gave back almost entire year due to ECB hawkishness.  Watch this space.  More big moves here will determine asset trading … Continue reading

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The Bonds With A Draghi Tattoo

On Tuesday,  June 27th,  Super Mario said this, “Deflationary forces have been replaced by reflationary ones.”  – Mario Draghi And here is how global 10-year bond yields reacted, The German 10-year Bund yield increased 77 percent — OK, from a … Continue reading

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The Ambiguity of Stock Value: Why It’s So Difficult to Call The Top

This is one of our favorite posts of all-time. Thought it apropos to re-post given that everyone and their mother is trying to call the top in stocks.  It’s all about yield-seeking capital flows, my friends.   Tell us what interest … Continue reading

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The Rack Trade

Ever have a pairs (spread) trade where both sides were moving against you?  Ouch!  Been there, don’t want to do that.   Well, this is what we call the rack trade  (Kudos to Doug Skrypek for coining the term).   You … Continue reading

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Emerging Market Dollar Bonds: An Option Based Analysis

In my prior life I used to trade emerging market (EM) bonds and came up with the following analytical framework using options analysis to understand and teach the basic fundamental principles of how to value EM hard currency bonds.   The … Continue reading

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The New Bond Math

Don’t you just love his homework assignment?

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Reflexivity And Why The Fed Must Sell The Long End

The yield curve is flattening like a pancake.   Tightening cycles tend to do that. Furthermore, the effective float of 10-year and longer U.S. notes and bonds is relatively small and greatly distorts the bond market signal.   We have written … Continue reading

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Fed Ownership of Yield Curve and Balance Sheet Reduction

Here you have it, folks, a one stop chart. The chart below shows the total outstandings of Treasury bonds and notes,  the Fed ownership of the total maturities and percentage of outstandings in each year of maturity (note, the data … Continue reading

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Major Holders of the US Corporate Bond Market

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