Given that shorting bonds has been an investment pariah until 2022, AlphaSimplex’s Chief Research Strategist and Portfolio Manager, Kathryn Kaminski, together with one of their research scientists, revisit some common myths and misconceptions for shorting bonds to help clarify why, when, and how often trend followers may be shorting bonds in the future.

Highlights

  • Myth #1: Shorting bonds never works.
  • Myth #2: Higher rates mean trend followers will continually short bonds.
All investing involves risk, including the risk of loss. Investment risk exists with equity, fixed income, and alternative investments. Alternative investments involve unique risks that may be different from those associated with traditional investments, including illiquidity and the potential for amplified losses or gains. Past performance is not necessarily indicative of future results. Diversification does not guarantee a profit or protect against a loss.

This material is provided for informational purposes only and should not be construed as investment advice. The analysis and opinion expressed represent the views of Kathryn Kaminski as of July 2022, and may change based on market and other conditions. There can be no assurance that developments will transpire as forecasted, and actual results may vary.