You might have already seen his twit/xpost. main thread -
https://twitter.com/BillAckman/status/1686906272937869312
trying to understand some of the things he has mentioned.
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https://www.macrotrends.net/2521/30-year-treasury-bond-rate-yield-chart
30 year yield seems to be above 3 or even multiple of that for many years in last 4 decades. so why is he thinking it being 5.5 a big deal -->
"So if long-term inflation is 3% instead of 2% and history holds, then we could see the 30-year T yield = 3% + 0.5% (the real rate) + 2% (term premium) or 5.5%, and it can happen soon. "
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2." That’s why we are short in size the 30-year T — first as a hedge on the impact of higher LT rates on stocks, and second because we believe it is a high probability standalone bet. There are few macro investments that still offer reasonably probable asymmetric payoffs and this is one of them. "
if current 30 year yield is around 4.6 and he thinks it will go to 5.5, how come he has taken a short position ? or what exactly is he doing ?
If possible, could you please explain the trade he has made and what needs to happen for him to profit from it ?
---------------------thanks in advance for sharing your knowledge!
[link] [comments] https://www.reddit.com/r/stocks/comments/16tpw45/what_does_this_from_bill_acmans_xpost_mean/
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