Does anyone know how I can learn to trade CDS's ? Where do they trade? What are the tickers? How do they trade? I use Interactive Brokers...
You can buy a synthetic CDS. Take $1 billion and flush it down the toilet. Voila, you just bought a synthetic CDS.
great question, though i'm afraid to hear the response (probably need to be an institution or have an institution sized account)
No word yet on where/how they trade, but I suspect you'll need rahter deep pockets to do so -- or that they'll be available only to institutions. That said, my first response was to say go trade BAC, C, MS, GS, XLF, AIG as a proxy for CDS.
From what I know: CDS are traded over the counter with another party. Since the other party has to believe you can repay him a retail investor/trader is not a good party. Also, there is a question of size, you need all the legal setup to trade CDS so they do business when there is big size deals. So, no chance, buy puts instead
ICE just recently received approval to start trading these things. Maybe they will show up on IB soon. Right now I think it is unavailable though.
I see the ICE just got approval to clear them but they website shows no code for credit default swaps. I can buy puts on the financial institutions but I like to have real time quotes on CDS' so that you can see the whole market.