Hedging Against China Debt Default Costs Least Since 2008
(Bloomberg) -- Looser monetary policy in China has helped push the cost of insuring the country’s five-year government bonds against default to the lowest since 2008. That makes it a good time for investors to hedge their bets on Chinese junk bonds, according to Lucror Analytics Pte.
“You can receive a high yield of 6.5 percent on reasonable quality property dollar bonds and hedge the systemic and technical risks for as low as 40 basis points now,” said Charles Macgregor, head of Asia at the firm. “It is cheap insurance,” he added.
2019-04-25 00:42:58.577 GMT
By Annie Lee