How best to profit from a rate cut

Discussion in 'Strategy Development' started by tradingcards, Aug 10, 2007.

  1. If I believe that the Fed will cut rates, what is the best position to take in what security to best profit from that?

    If the answer is buy bonds, then, specifically which bonds will have the most bang for my buck (most price movement)

    Thanks for the help
     
  2. Mr B

    Mr B

    short dated bonds - ie 2 year or 5 year.
     
  3. buy yen/usd

    the carry trade will come apart..
     
  4. Mr. B

    Did you mean sell short bonds, or buy short time frame bonds ie 2-5 year?
     
  5. BJL

    BJL

    fed fund futures or options

    best bang for the buck probably the fed fund binary options
     
  6. dinoman

    dinoman

    Short the SPY off the bounce. We are heading for the same train reck the Japan markets experienced in the 90's. The Fed has little power to help us in this scenario. The best they can do is accelerate the plunge for the U.S. dollar.