Pro Macro: In Focus – Bonds Are Your Friend

Published on: February 28th, 2022

In times of change, trouble and uncertainty, you got a friend in Bonds…

Comments

  • JA
    Joseph A.
    28 February 2022 @ 23:49
    I think aside from geopolitical risk factors, markets will get some relief after the Fed rate announcement in March. Thoughts?
  • SB
    Stephen B.
    1 March 2022 @ 00:06
    Great stuff, thanks Raoul
  • MS
    Mark S.
    1 March 2022 @ 04:41
    Hi Raoul, Thanks. I don't know if this is a minor detail but you said owning the 10 year was the way to go but then recommended the TLT which I thought was the 20 year. Or did you just mean generally the long end? I bought ZB calls the other day but am wondering if I should have bought ZN. Cheers.
    • IB
      Ivan B.
      2 March 2022 @ 11:25
      Raoul could please include futures altertive as well? Thank you!
    • RP
      Raoul P. | Founder
      1 March 2022 @ 16:05
      I would have said bond futures but as most people who read MI are not pro's I made it easy with TLT
    • JW
      JW2 W.
      1 March 2022 @ 14:16
      That is a bit odd indeed....IEF has 7-1o Yr Bonds, so that might be a better fit if your are targeting 10yr as teh sweetspot.
    • JA
      JOSEPH A.
      1 March 2022 @ 13:18
      Mark, my thoughts exactly, maybe buy both just in case :-)
  • MR
    Michael R.
    1 March 2022 @ 15:38
    Hello, anyone bought into tlt-calls? - they never traded at 3.50. currently 4.5/5 - wait for a better entry?
    • BF
      Ben F.
      1 March 2022 @ 16:36
      i bought 50% at 4.3 and left an order at 3.6, but don't think it's revisiting down there now
    • MS
      Mark S.
      1 March 2022 @ 16:07
      I'd buy in segments. Decide an amount to invest. Decide a time frame (1 day, 1 week, 1 month ..), decide how many installments to make, (3,5,10..) and evenly start buying based on $ amount for each installment regardless of price, or go to higher strike. Watch your IV.
  • JL
    John L.
    1 March 2022 @ 16:18
    impossible to get in at those prices. great.
    • HM
      Harry M. | Real Vision
      2 March 2022 @ 18:56
      So sorry, but the Fed looks like it has given us another entry point.
  • BF
    Ben F.
    1 March 2022 @ 16:37
    Raoul, any thoughts on carbon at the moment? I'd like to buy some more but not sure where the bottom will be.
    • JW
      JW2 W.
      2 March 2022 @ 08:31
      Are you following Lawson on Twtter?
  • sj
    samir j.
    1 March 2022 @ 18:38
    if only this was out on Sunday we could have bought on Monday. This was out monday evening and by the time the market opened on Tuesday the calls were 5. which cuts the risk reward from 4:1 to 2.5:1. Question for Raoul- would you still recommend the trade?
  • WM
    William M.
    1 March 2022 @ 21:12
    Unfortunately didn't see this till this afternoon and calls already up to $5! Too much stuff going on. Great review Raoul. I agree with almost everything you say. Too many people, especially politicians, simply cannot see this from Russia's perspective. I think it was Cardinal Richelieu who said that War is a failure of diplomacy. The Ukraine is now in a simply terrible situation and so many armchair warriors are urging more direct Western involvement. I don't want a nuclear conflict and any clash between Nato and Russian (and possibly Belorussian) forces would raise that risk immeasurably. Best hope is for Zelensky to offer Putin a Donbass referendum on whether to be Independent, stay with Ukraine or join Russia, in return for a ceasefire. But Zelensky was a comedian/ actor so knows how to posture, but may not have read much history....... My thoughts are with the Ukrainian people at this horrible time.
    • HM
      Harry M. | Real Vision
      3 March 2022 @ 12:11
      Forgive me. Im always piping up with some trivial detail. It just so happened a Russian friend of mine happened to make that point to me a little earlier in the day. So it was fresh in my mind.
    • WM
      William M.
      2 March 2022 @ 19:56
      I defer to you Harry, dont know that much about Zelensky's family background at all.
    • HM
      Harry M. | Real Vision
      2 March 2022 @ 18:55
      My Russian-speaking friends say that while Zelensky was a comedian, he comes from an academically very successful family and is very well educated. I think he has read plenty of history. It may be that the politics of that part of the world makes negotiation impossible till there is obviously no alternative. But otherwise I agree with your points. Its a mess, and the kind of mess which kills people.
  • rm
    roland m.
    1 March 2022 @ 21:35
    Any thoughts on the Carbon trade after it dropped like 20% in the last two days?
    • rm
      roland m.
      7 March 2022 @ 10:50
      Thanks a lot for your input Harry. I guess this statement here nicely summarizes a lot what's going on: https://kraneshares.com/krbn-fundamentals-remain-constructive-uncertainty-causing-volatility/ Source obviously prone to be biased.
    • HM
      Harry M. | Real Vision
      2 March 2022 @ 18:52
      I await RPs thoughts, but there is definitely something up. I think it broke out of a channel. I have no inside knowledge and perhaps it would be a good time for Mr. Andurand to come back and chat, but I do wonder if there is a risk with the current pressures on the Euro area energy system that the current rules might be suspended? Best to repeat I know nothing. Just trying to reverse engineer price action. But the price action in the last few days is a bit of a departure.
  • JW
    James W.
    2 March 2022 @ 03:39
    Raoul, one of the best trades we ever had was on the eurodollar future option trade. Please continue to include futures trades in your recommendation.