Monday, January 16, 2012

The Trade of the Decade

We all know that the next big short will be the US treasurys, notes and bonds.  The question is to know when to start shorting.

For the US debt I would still wait a few months or maybe even a year (Thanks to the Zero Interest Rate Policy).  However, when I look at the High Yields I think it's time to start shorting now.

I would short the ETF HYG with a target of at least 84$.

The Imperatore


Anonymous said...

how about buying the sbnd? Its only around $9. The lower it goes the better the trade, you almost want it to go to $6. Buy it and forget about it, take it all at 30 in a couple of years...

The Imperatore said...

I looked at SNBD, it sures wants to go higher, maybe test 12$ in a few weeks. But keeping a 3x leveraged ETF for the long term could be quite dangerous even if you have the good direction.

I'll consider playing it for a short term pop.