4 ms·
I'm not aware of any useful hedge for long term US government bonds. There are inflation protected bonds (TIPS), but they wouldn't have worked as a hedge in thi
by bjornsing 4y ago
I'm not aware of any useful hedge for long term US government bonds. There are inflation protected bonds (TIPS), but they wouldn't have worked as a hedge in this case [1].
1. https://www.schwab.com/learn/story/treasury-inflation-protected-securities-faqs-about-tips https://www.schwab.com/learn/story/treasury-inflation-protec...
- inconceivable 4y agothere are interest rate swaps (insurance, basically) but i think there may be some kind of regulation against banks engaging in derivatives trading?
- twic 4y agoThe "Volcker Rule" bans banks from trading derivatives for profit, but they are allowed to use them for hedging.