Tags: robertson | curve | caps

Robertson Invests for Huge Rate Hikes

By    |   Monday, 05 Oct 2009 02:48 PM

Julian Robertson, founder of Tiger Management, the former hedge fund firm, is protecting himself against the possibility of foreign buyers halting their purchases of U.S. Treasury securities.

Robertson has acquired “curve caps,” which function much like leveraged put options on long-term government bonds, Bloomberg reports.

“They would insure us in the event of massive rate increases,” he said.

Robertson has previously said that if China and Japan stop buying U.S. bonds, the country could experience financial “Armageddon.”

The Treasury Department may need to get new investors by increasing interest rates, he said.

Robertson now only invests his own money in 40 independent hedge funds that he advises in return for a portion of profits.

In January, he predicted that long-term interest rates would increase to a minimum of 7 percent during the next three to five years.

Other investors looking for a safe haven have bought Treasury inflation-protected securities, or TIPS, the Wall Street Journal reports.

During 2009, TIPs funds have records huge levels of investments, including some weeks of reporting over $400 million in sales. Investors also have rushed into commodity funds and gold funds.

© 2017 Newsmax. All rights reserved.

 
1Like our page
2Share
StreetTalk
Julian Robertson, founder of Tiger Management, the former hedge fund firm, is protecting himself against the possibility of foreign buyers halting their purchases of U.S. Treasury securities.Robertson has acquired “curve caps,” which function much like leveraged put options...
robertson,curve,caps
186
2009-48-05
Monday, 05 Oct 2009 02:48 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved