In January, I posted that it was looking reasonable to short Treasurys, long junk bonds (but a better entry price could be had), and probably avoid (but not short) higher grade corporates and munis in general. How has that done since my post on January 6th?
Using the ETF proxies: TLT (long bond): -13%, so a short would have made 13%.
Junk Bonds (HYG): -0.4% (there was a chance to buy in at ~10% lower prices)
Higher-grade corporates: LQD: -2%
Munis: 6%
Well, the bond calls would have made 6.3%, assuming equal weight, compared to a 2% gain in the “avoid” list.
Filed under: General Investing
