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Post by Chahta on Mar 10, 2023 15:57:50 GMT
OK, the jobs came in higher than expected. The Fed is threatening to go 50 BP this month. Why are bonds rallying? Is it due to the market tanking?
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Post by retiredat48 on Mar 10, 2023 16:13:19 GMT
OK, the jobs came in higher than expected. The Fed is threatening to go 50 BP this month. Why are bonds rallying? Is it due to the market tanking? How about: A FAILED BANK ...silicon valley bank. Guru's often state the fed will raise rates UNTIL SOMETHING BREAKS. Well something broke today, and small banks having a huge selloff. Nervous fed. Also, the jobs report showed softness continuing...pay raises not that large; unemployment back to increasing etc. R48 |
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Post by FD1000 on Mar 10, 2023 22:47:44 GMT
Remember, today, the explanation could be X and bonds do well. On Monday bonds can lose and the explanation is still X. Markets are built on expectations/rumors/news, there is no way to know. Right now the FedWatch tool is at 60+% for only 0.25% next meeting.
This is why I watch market prices + trends, they tell you in real time what is going on. To trade I need a trend.
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mikes425
Commander
generally happy in semi-retirement and dividend income-land
Posts: 126
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Post by mikes425 on Mar 11, 2023 12:42:47 GMT
OK, the jobs came in higher than expected. The Fed is threatening to go 50 BP this month. Why are bonds rallying? Is it due to the market tanking? I presume it’s because theyre actually acting as a hedge against equity volatility. In any event, I hope they keep rallying. |
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Post by FD1000 on Mar 11, 2023 13:24:59 GMT
Another observation, if risk goes really up, then several bonds categories will lose too. The usual, it depends.😀
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Post by johnsmith on Mar 11, 2023 19:05:39 GMT
and this is the explanation by Jeff from Eurodollar University:
"The payroll report was supposed to be today's sole topic. Instead, it was completely overshadowed first by a global bond buying panic sparked in Asia then carrying over throughout the US trading day. Failure of Silicon Valley Bank isn't the only problem, rather a symptom of the very deflationary money curves have been warning about."
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Post by FD1000 on Mar 11, 2023 20:45:09 GMT
I have seen so many times articles at 10 AM stating their opinions and suddenly markets change direction without any new incidents and the same writer has a new article. I concluded years ago that many opinions are based on what markets have done already, but can change daily because of the markets. I also have seen the same reasons were used for both up and down markets. So, why a security goes up? because there are more buyers than sellers.  |
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Post by fishingrod on Mar 13, 2023 12:02:28 GMT
The bond rally continues. The two year bond rallying another 50 basis points. Or almost 11% gain. Down to 4.09%. Will it go below 4%
CME FEDwatch tool has changed probabilities dramatically.
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Post by newtecher on Mar 13, 2023 12:48:49 GMT
The bond rally continues. The two year bond rallying another 50 basis points. Or almost 11% gain. Down to 4.09%. Will it go below 4%
CME FEDwatch tool has changed probabilities dramatically.
That would be a 1% gain for a 2-year bond. 10-year is up about 2%. 30-year up about 3%. However, it is changing all the time. |
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Post by fishingrod on Mar 13, 2023 14:12:22 GMT
The bond rally continues. The two year bond rallying another 50 basis points. Or almost 11% gain. Down to 4.09%. Will it go below 4%
CME FEDwatch tool has changed probabilities dramatically.
That would be a 1% gain for a 2-year bond. 10-year is up about 2%. 30-year up about 3%. However, it is changing all the time.
I believe I am correct in my percentage.
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Post by newtecher on Mar 13, 2023 14:29:56 GMT
That would be a 1% gain for a 2-year bond. 10-year is up about 2%. 30-year up about 3%. However, it is changing all the time.
I believe I am correct in my percentage.
Depends on what you mean by gain. Usually, people mean increases in bond prices, which is about 1% for 2-year today. What did you mean by 11%? |
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Post by fishingrod on Mar 13, 2023 14:33:38 GMT
newtecher, I was referring to the potential capital gain one would have if you had a bond that yielded 50 basis points more than it does today.
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Post by FD1000 on Mar 13, 2023 14:36:44 GMT
The bond rally continues. The two year bond rallying another 50 basis points. Or almost 11% gain. Down to 4.09%. Will it go below 4%
CME FEDwatch tool has changed probabilities dramatically.
That would be a 1% gain for a 2-year bond. 10-year is up about 2%. 30-year up about 3%. However, it is changing all the time. The 11% is about the rate itself. As investors we care about the % we actually make. At 10:36 AM VGSH(2 year treasury) is up 0.85%. |
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Post by newtecher on Mar 13, 2023 14:40:07 GMT
newtecher, I was referring to the potential capital gain one would have if you had a bond that yielded 50 basis points more than it does today. No, the cap gain would be about 1% for a 2-year treasury with 50 bps rate decline. |
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Post by fishingrod on Mar 13, 2023 14:44:14 GMT
ok, Sorry about my confusion.
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