Wall Street Swaps Steepening for Inversion in a Yield-Curve Bet
- Barclays issues $2 million of ‘flattener’ structured notes
- Holders can earn 10% return if curve remains flat or inverts
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Investment banks are offering a fresh way to profit from a U.S. yield curve flashing renewed warnings of recession.
Barclays Plc has sold $2 million worth of structured notes that benefit if the U.S. swap curve fails to steepen materially, or if it inverts a year from now. The product would typically pay off in a scenario in which bond investors fear the outlook for growth and inflation, amid diminished Federal Reserve firepower.