Regarding HYG: Please describe low strike. 75? Thanks!

What would be an alternative to futures market for this trade? I dont trade futures but stll interested on an ETF, Im thinking about buying UUP PUTS, but not sure whether would work kind of similar.

Thanks so much for your insights, Julian. So much has changed since November! You’re so right that the Fed has been extremely unresponsive to inflation especially given the evidence that they have pretty much achieved their mandate for full employment. You are convincing me of a greater probability that momentum will take us to an overheated economy. If that’s true and the Fed telegraphs an even more aggressive tightening than what futures markets are implying, then this market will be destroyed rather than a softer landing where we only get scratched up. Risk/reward for equity and spreads seems to be on the downside. For what it’s worth, your views have me switched from greed to fear for 2022 outlook at this point and I’m peeling off risk. And with many market participants in denial, I think it's just the beginning. With the normalization ahead of us, we’ll be in for a roller coaster indeed.

Thanks Julian, agree entirely! Some ideas: Inflation cancels the Fed put; that probably means we enter a new economic paradigm which is likely to surprise a wrong footed market. Volatility indeed going forward. If there is a labor shortage and inflation, then a real cooling down of the economy is warranted and necessary; might feel like a recession to the financial markets but not so much to a labor force in demand? Stop-go policy with big swings and each top and bottom of inflation and interest rates higher over the next few years would be a 'replay' of late 60 and 70'ies? The big driver then was higher energy prices, and with the renewable energy drive ahead of us, I suspect the initial impact will be higher energy cost for all of us over the next decade. Any softening in the economy would open up for Biden's infrastructure plan, kickstarting the economy, investment spending, inflation and labor shortage. Rebuilding the global energy infrastructure is a massive undertaking. Weaker markets will encourage boomers to not retire and stay in the labor force which is ok with the Fed? (maybe not so ok for the boomers....) Higher nominal growth rates with a higher inflation reduces the Fed balance sheet over time compared to the GDP, which is what matters. They tighten by just maintaining the balance sheet at todays nominal level. Interesting times.

Has our EURUSD trade stopped out?