Comments on: Long Bond http://www.mylifemytrade.com/2009/06/long-bond/ Sat, 04 Sep 2010 09:19:32 -0400 http://wordpress.org/?v=2.8.4 hourly 1 By: mral http://www.mylifemytrade.com/2009/06/long-bond/comment-page-1/#comment-23 mral Mon, 15 Jun 2009 00:10:05 +0000 http://www.mylifemytrade.com/?p=88#comment-23 sorry, i the only bond books i have read are about specific things - e.g. the treasury bond basis by fabozzi. i am sure there are basic books out there but i have never looked.<br><br>the instruments i follow closely (apart from the on-the-run cash bonds) are the 10yr & 30yr treasury future. the tickers are tyu9 (sept 10yr future) and usu9 (the sept 30yr future). the ONLY one that is relevant to tlt & tbt is usu9.<br><br>the market did good work on thur & fri, but stalled exactly at resistance. therefore, the burden of proof is still on the bulls - not the bears.<br><br>your observation about equities & bonds is correct. we are not trading inversely as much as we were. what this is all about is the $. the worst case for the fed is if yields rise AND stocks fall. this is what i call the "sell america" trade and would be disastrous. sorry, i the only bond books i have read are about specific things – e.g. the treasury bond basis by fabozzi. i am sure there are basic books out there but i have never looked.

the instruments i follow closely (apart from the on-the-run cash bonds) are the 10yr & 30yr treasury future. the tickers are tyu9 (sept 10yr future) and usu9 (the sept 30yr future). the ONLY one that is relevant to tlt & tbt is usu9.

the market did good work on thur & fri, but stalled exactly at resistance. therefore, the burden of proof is still on the bulls – not the bears.

your observation about equities & bonds is correct. we are not trading inversely as much as we were. what this is all about is the $. the worst case for the fed is if yields rise AND stocks fall. this is what i call the “sell america” trade and would be disastrous.

]]> By: MyLifeMyTrade http://www.mylifemytrade.com/2009/06/long-bond/comment-page-1/#comment-12 MyLifeMyTrade Sun, 14 Jun 2009 13:01:09 +0000 http://www.mylifemytrade.com/?p=88#comment-12 It is not obvious that shorting TBT is better than going long TLT... This is same analogy as "is shorting SKF at 250 (back in March 1st week) better than going long XLF". I offer two reasons:<br>- if I have OTM options, a bigger $$ decline (not %... but big absolute $$ decline) makes it very attractive to short the 2x inverse rather than go long the underlying<br>- TLT could chop up and down AND TBT would still lose value because of the decay associated with leveraged ETFs (See <a href="http://www.mylifemytrade.com/2009/05/understanding-decay-in-leveraged-etfs/" rel="nofollow">http://www.mylifemytrade.com/2009/05/understand...</a> for an extreme example) It is not obvious that shorting TBT is better than going long TLT… This is same analogy as “is shorting SKF at 250 (back in March 1st week) better than going long XLF”. I offer two reasons:
- if I have OTM options, a bigger $$ decline (not %… but big absolute $$ decline) makes it very attractive to short the 2x inverse rather than go long the underlying
- TLT could chop up and down AND TBT would still lose value because of the decay associated with leveraged ETFs (See http://www.mylifemytrade.com/2009/05/understand... for an extreme example)

]]> By: Peasant http://www.mylifemytrade.com/2009/06/long-bond/comment-page-1/#comment-10 Peasant Sun, 14 Jun 2009 12:05:45 +0000 http://www.mylifemytrade.com/?p=88#comment-10 Just curious why you buy TBT puts versus TLT calls. Are they cheaper and therefore offer better risk/reward ratios? Just curious why you buy TBT puts versus TLT calls. Are they cheaper and therefore offer better risk/reward ratios?

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