Hedge Funds Place Biggest-Ever Short on US 10-Year Treasuries

The video discusses the CFCC positioning data, highlighting the significant net short positions on 10-year bonds and across the curve by hedge funds. It explores potential market reactions to upcoming US GDP and PCE data releases, suggesting that hedge funds might be anticipating strong economic indicators. The video also notes that hedge funds use treasury futures for both directional plays and relative value (RV) trading, with declining volatility possibly indicating a major RV trade setup.

What is notable about the CFCC positioning data regarding the 10-year bond?

• It indicates a balanced position.

• It shows no significant change.

• It indicates the most net shorts on record.

• It shows the most net longs on record.

Why might hedge funds be positioning short across the treasury curve?

• They anticipate a strong US GDP and a hot PCE number.

• They expect a decrease in US GDP.

• They foresee a decline in inflation.

• They predict a Fed rate cut.

What economic indicators are mentioned as potentially influencing hedge fund strategies?

• US GDP and the PCE metric

• Unemployment rate and CPI

• Retail sales and housing starts

• Trade balance and industrial production

What is a possible reason for hedge funds using treasury futures, aside from directional plays?

• For increasing leverage

• For relative value trading

• For hedging against currency risk

• For reducing transaction costs

What trend in volatility is noted in the context of hedge fund strategies?

• Volatility has been increasing significantly.

• Volatility has been stable.

• Volatility has been declining significantly.

• Volatility has been unpredictable.