Retarded Question RE: Bond Trading
This will come across as slighly special, and maybe I am overthinking it but was just wondering if someone could help.
If you are a Sov bond trader on the buy side, I.e working at a macro fund. Is your reasoning for buying the govvies for capital appreciation or yield? or both?
Like I remember reading that guys made a killing buying up greek debt and with the decreased risks making money through cap appreciation as yields declined. Is this the main reason? To capitlise on rising and falling yields and thus making money on the change in the par value?
I understand that this is more of a 'fast money' type of strategy Vs. a mutual fund who would most likely be buying for yield.
Cheers - I hope someone can help validate.