Canadian Finance, Economics and Fiscal Analysis
Bill Ackman has made the news about being short 30-year treasury bonds (buying puts on treasuries). You can play this trade at home too, by buying puts on TLT – at the money on long-dated options is trading at an implied volatility of about 16.5% right now. The below chart is the 30-year treasury bond … Continue reading “Long-term treasury yields”
The Hoisington Investment Management Company has been completely slammed in the past year because of their bullish projections on long-dated treasury bonds, but one of their principals, Lacy Hunt, makes for always educational reading. The fund’s Q3 commentary is well worth reading. Key takeaway: The Fed’s mettle will be tested because highly over leveraged institutions … Continue reading “Lacy Hunt on the Federal Reserve”
I would be lying if I said the past week was pleasant, but one of the reasons why your portfolio decisions have some form of fundamental underpinnings is to just look at the quantitative situation instead of getting swayed by the emotions when you see the market value of the asset drop. Readers of Thaler … Continue reading “Mechanics of price volatility in markets”
“How much should I pay for the equity” is an easy question to ask, but computing all of the variables to come up with a range of prices is not so easy. One of the components is the rate of interest. As interest rates rise, you want your cash flows today instead of tomorrow. For … Continue reading “In a rising rate environment, cash flow talks – ARCH’s payout phase”
Almost everything I’ve put bids on (very near the market) have creeped away from the bid. It is also not like I put a ten million dollar limit order in the market either – I break things away into very small sized chunks and scale in as market volatility takes pricing lower (or vice-versa in … Continue reading “A small note and investing in the lottery!”