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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: Crimson Ghost who wrote (2381)	11/19/2003 12:39:01 AM
From: mishedlo	Read Replies (1) of 110194

Looking at all the spreads and implied rates the best bang for the buck is on dec eurodollar spreads. The long 97.75 short 98.00 costs 14 basis point and can return 25 basis points. You win 100% of that spread if interest rates do not hike more than 3/4 point in that timeframe. Risk 14 gain 11 but odds big in your favor if I am correct. 11/14 = 78% return If you want a near 100% lock (IMO) the 97.25/97.75 costs about 32 and will return 50 a 56% gain (18/32) This play wins on interest rates of 2% or less I consider this a near certainty M

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