macrocephalopod

Bonds keep trading. 1 point up EVERY trade. 10am 53h 2pm 54h next day: 56h EVERY single trade is literally moving this $10B market 11/

F 12%, we need to happy with 10% YTM Now the justifications start: "it can't be that bad, housing will be fine" "govt will have backstop" "are we even trying to make money here" assumptions reset again. bids higher mh60s 13/

HY is tightening. Market is healing. bid l70s, still high singles YTM, but "we need to think in total return" offers start flowing. SELF DOUBT. Was I too aggressive? Did I move the market 10 points in a week? Is there a dip coming? Bonds trade away 73. BID 75. F THAT GUY. 14/

Broker: "hey I know you like X but I have Y at 60" Y = GARBAGE bond that's WAY worse 3 weeks ago = NO f-ing way I'm ever touching Y. Who in their right mind would buy that? Updated mindset = What if my assumptions are off? What if Y is the jugular play? Bid 59. Hit 15/

CANT MISS OUT. THESE ARE GOING TO 90. PM is fully bought in (at prices 60% higher than literally 3 weeks ago) YOLO time. IB to broker "I want ALL bonds of this kind... here are standing bids " YTM? Who cares. Intex takes too long to load, and they're moving up anyway 16/

So how did it end? Bonds traded h80s/l90s in June. In less than 2 months, some bonds had DOUBLED in price. Obviously I didn't buy that many in the 40s, I think most were actually in the h50s/l60s. So much was about when sellers stepped up. 17/

The relative value of these securities reset about ~50 times in 25 trading sessions. At first, every trade was analyzed. Every tick was counted. And by the end, price was irrelevant. Conviction increased whenever a competing bid came in. 18/