matrix trading

Matrix trading

Swapping bonds in order to take advantage of temporary differences in the yield spread between bonds with different ratings or different classes.

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matrix trading

Swapping bonds of different classes or risk levels to take advantage of unusual differences in yield. For example, during a period when the difference between yields on AAA and AA bonds is especially small, an investor swaps AA bonds for AAA bonds to pick up added safety at a small sacrifice in yield. When the difference in yields widens, the investor then swaps back to the higher-risk, higher-yielding AA-rated bonds.