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Odd Lots cover image

Bill Gross on the End of the Great Bond Bull Market

Odd Lots

NOTE

Managing Hedge Duration Risk in Bond Investments

To manage hedge duration risk, PIMCO believes in selling volatility, which has consistent alpha over time. Buffett also follows a similar strategy. One way to hedge duration risk is by selling a put and call on a 10-year treasury contract for 30 days. This helps bring premiums down to the bottom line as long as the market remains stable.

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