JDS Uniphase (JDSU) Message Board

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Technology Stocks : JDS Uniphase (JDSU)

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To: SJS who wrote (5968)	2/3/2000 1:16:00 PM
From: t2	Read Replies (1) of 24042

I don't think the hedge funds that short bonds are shorting high PE stocks with a high degree of correlation At least there would be a correlation of those that shorted the 30 year bond and the way the cyclical stocks are trading. To me that makes a lot of sense. If you are worried about the impact of higher interest rates on the stock market, you would be more concerned with the Nasdaq stocks rather than the cyclicals. Therefore to protect your short on the long bond, you would be long on these and not the Nasdaq. If the short covering in the bond is happened or happening, there could have been a lot of selling of these types of stocks (cyclicals etc) as a result. This not a science. If it was, those hedge funds would have figured that out by now and done a lot better than individual investors do. Old patterns of hedge fund behavior may not give a true picture of what is happening today. It is a matter of developing a theory of what is happening right now. That is my take on it. Of course i could be wrong. I am referring to what has happened this morning and yesterday (maybe all of this week). That is correlation between the 30 year bond and the "safer" value stocks.

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