Long Term Treasury Bonds/TBT

Ok, i’ve been watching TBT and prices/yields on long term bonds. Why have prices on long term treasuries been rising when the market is pricing in a small recovery? Dollar has been mixed and commodities rebounded slightly. Still no signs of inflation. Why are people still buying these long date treasuries?

Strong auctions, quantitative easing

thought the fed stopped buying treasuries. who are buying these tresauries? demand still coming from asia? thought they were running smaller trade surpluses edit: i want to enter into a position

Not sure where you’re getting your information from, the Fed’s buying through October.

There’s still demand for tsys which is evident in the auctions. The tsy keeps issuing hundreds of billions in govt debt and institutions are still taking it down. Today it looks like we’re trading closely w/ the equity markets. It’s also month end for some EU institutions since Monday is a bank holiday, so they may need to buy duration in order to compensate for the index extensions.

I wholeheartedly believe that the FED is allowing FCBs to swap out agency debt for treasuries…its part of the deal to keep this ship afloat…gotta throw them a bone ya know

i think there’s still a lot of (warranted) fear of deflation out there.

So nobody is betting on inflation yet? Good trade in 2-3 years out?

I lost 15% on TBT :slight_smile: While i believe inflation is imminent, buying ultra fund may not be such a great investment due to its churning

^i agree TBT is tough unless there’s a lot of upward action on rates. Flat rates = slow drain on TBT because of leverage. I got in end of 08 and have done ok but I’m looking for a better way to play rising rates. What I really want is protection against a dollar collapse. tough as a retail investor w/ small account.

Jbald, I was worrying about that too. I was thinking about non-hedged global bonds. Its tough finding a fund because I’m looking for an asia ex japan & commodity producer devleoped market global bond fund invested in investment grade bonds. The fees are steep ~1.5%.

Leveraged loan funds. They are floating rate and still trading under par so the YTM is huge and gets huger as rates rise.

Iheartiheartmath, how much do you have to worry about the credit quality of these loans? Correct me if I’m wrong but I thought leveraged loans were bank loans?

Buy a fund, diversify the risk. You’re going to be subject to some credit risk but I could argue that it is lower risk than investing in a high yield corporate bond fund, which the investing public generally seems to have no problem doing.

^leveraged loans are secured and have higher recovery rates in event of default.

^what he said


^don’t be an @ss

Insurance companies may still need long duration assets.

iheartiheartmath Wrote: ------------------------------------------------------- > ^don’t be an @ss no google is where i copied and pasted from.