your most memerable trade?

[RealRaver]

Being short CDS on Lehman for a notional of $10m when they defaulted.

 

[cuotes]

Tragic and entirely unnecessary ending for what was a guy who started with very little and turned that into so much.

The trip between "very little" and "so much" is not an easy one.

 

[Stewenson133]

Being short CDS on Lehman for a notional of $10m when they defaulted.

:cheesy:

of course the best trade of a life... then you may want to kill ur self
i suppose

 

[RealRaver]

No at that time there where loads more companies about to go bust, idearc was another good one. CDS market was crazy last year, has clamed down abit now. I it was cheaper to insure macdonalds debt than U.K. debt.

 

[Skill Leverage]

Of course it was cheaper - MacDonalds actually has demand. The UK on the other hand, lists at No. 6 in the Top 10 exports to the US 'Goods purchased from US then returned'.

 

[RealRaver]

The widening of the U.K. CDS spread was more caused by the amount of debt that the U.K had issued and the potential downgrade from the ratings agencies. I still think that it was surprising that the market through that the U.K. was more likely to default on its debt than Macdonalds. Btw MacD trades wider again now.

 

[Skill Leverage]

I'm pretty well clued-up on government debt thanks, being as it's my job and all. But thanks for ruining my light-hearted moment.

 

[arabianights]

The widening of the U.K. CDS spread was more caused by the amount of debt that the U.K had issued and the potential downgrade from the ratings agencies. I still think that it was surprising that the market through that the U.K. was more likely to default on its debt than Macdonalds. Btw MacD trades wider again now.

yer but weren't most of what was driving that higher a combo of RV and anticipated RV trades?

also if mr leverage claims to be 'clued up', make sure you probe him. possibly anally.

 

[RealRaver]

Yeah partially, alot of people where looking to create negative basis trades both in the Sovereign and Corporate debt markets. Also I think alot of people just throught the u.k. was really ****ed.

 

[Skill Leverage]

yer but weren't most of what was driving that higher a combo of RV and anticipated RV trades?

also if mr leverage claims to be 'clued up', make sure you probe him. possibly anally.

Probe away, I've got Investopedia and a gallon of lube at my disposal.

 

[Stewenson133]

Yeah partially, alot of people where looking to create negative basis trades both in the Sovereign and Corporate debt markets. Also I think alot of people just throught the u.k. was really ****ed.

what do u mean with negative basis?

 

[RealRaver]

A negative basis trade is where you buy a bond and CDS protection on that bond to create a risk free position (bar the credit risk of your CDS counterparty)