Bond Traders Net Millions on Bearish Option Bets After Trump Win
- Trading suggests profit-taking on positions entered last month
- Selling seen Wednesday in both 10-year and long-bond options
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In the market for Treasury options, speculators appear to be cashing in on bets placed a few weeks ago that would benefit from a jump in yields, and are likely netting millions of dollars in profits.
As Treasury yields surged to multi-month highs Wednesday in the wake of Donald Trump’s re-election to the presidency, several large block sales were seen in US bond options, in both 10-year notes and the long-bond contract. The same option strikes were bought on Oct. 11 at lower prices, suggesting Wednesday’s sales were a move to unwind the positions entered last month, rather than a new stake.