Trading Logistics - Can you trade bond/equity spreads
Can you trade bond and equity spreads (aka long/short debt of a company and short/long the same company's equity) out of a personal account?
Can you trade bond and equity spreads (aka long/short debt of a company and short/long the same company's equity) out of a personal account?
Career Resources
There's no rule against it, but it can be tough for a few reason: a) Corporate bonds are in high denominations (usually $1000 and up) so making trades at low levels is hard b) Corporate bonds are less liquid than equities with each issue traded OTC by market makers, most of whom won't care to do business with anyone not making large trades and/or will give you shitty pricing
To trade bonds you need to be an decently sized institutional investor. Like have $50mm of balance sheet, if not more. Reason being is to get decent pricing you have to trade in blocks of $1mm and greater, but if those aren't deterrents then go ahead.
And Corporate bonds are liquid not as liquid as equities with actual quoted prices at exchanges but they are not any where close to other parts of the bond market.
I don't think you even know what you're asking. Trading "equity spreads"? And you don't trade "bond spreads", you trade bonds on spread, which wouldn't be logistically different than trading bonds, you'd just hedge yourself by selling treasuries short.
Thanks for the primer on capital structure arbitrage.
In any case he is using awkward terminology which means he probably wouldn't know what he's doing.
Quo saepe delectus non quidem officiis sunt. Voluptatem iusto voluptas aut et magnam praesentium exercitationem. Incidunt aut dolor delectus enim commodi.
Vel omnis et voluptatibus voluptatum repellendus. Recusandae ut nisi fuga dolor sint dicta facilis. Cupiditate minima sequi tempora fugit ea ipsam facilis. Iste beatae nostrum porro error. Et ab dolorem quo.
Eveniet laborum et eaque occaecati repellat esse. Eaque reiciendis placeat debitis quas dolore. Amet quisquam qui ducimus et quis est quis. Veniam ab sunt nihil et odit aut. Sunt a id velit consequatur officiis quia molestias.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...