Big Treasury Options Trade Shows Anxiety About Jackson Hole
- Bullish wager is hedge against 10-year yield dropping to 1.45%
- Option expires hours after Powell delivers Jackson Hole speech
Tourists view the Grand Teton mountain range outside of the Jackson Lake Lodge in Moran, Wyoming.
Photographer: David Paul Morris/BloombergThis article is for subscribers only.
Bond traders appear worried that Federal Reserve Chairman Jerome Powell’s Friday speech in Jackson Hole could reignite the rally that drove Treasury yields to multiyear lows last week.
A purchase of Treasury options for more than $8 million on Tuesday suggests that large positions -- the hedging of which contributed to the rally -- remain at risk in the event that Powell sounds dovish notes.