T-Bond trading comment (November 27, 2007)

Reversal day! After yesterday's run-up, today we saw some nice distribution. At one point the market was loosing alsmot 2 bucks... Talk about crazy days.... The short we put in place yesterday at the settlement was taken off during the night as the T-bond went crashing down, before picking-up ground for our open. From there on, the market essentially monitored what happened in the credit and equity market for the rest of the day...

If you think that the market is too high and don't want to risk too much money, an interesting play is to buy put spreads... This morning at one point, the 117-116 put spread for march was trading around 22/64... This is almost some 3 to 1 profit ratio...

That is it for tonight. Short message, no time for more