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So I suppose you would never want to trade a market where
hedging is a big factor?
Only trade those markets dominated by traders, few hedgers?
You seem not to understand the futures markets, in particular the
distinction between hedging and trading.
Since you do most of your "work" in long-term bonds, perhaps you could
supply some statistics for your claim that most of the money in munis comes
from the hedgers. (clue: ratio of open interest to volume). Maybe you
are right, in which case I will happily trade against the hedgers.
Neal
> I sat back for a while before I sent this message. Because - although I
don't
> trade bond futures - I do a lot of work with bonds - especially munis. I
have
> to believe that most of the money in muni bond futures consists of
hedging
> positions. (Which is why it's hard for me to buy cash bonds at market
lows -
> the big guys are holding their actual cash bond positions and hedging
with
> futures waiting for higher prices). I suspect that any small potatoes
trader in
> this market is working with at least 2 strikes against him. Robyn
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