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What Does High Yield Credit Know That Stocks Don't?

Tyler Durden's picture




 

It's one of those low-volume melt-up technical kinda days... so why is the should-be-correlated high-yield credit market selling off? (and Treasuries rallying as stocks push swing highs). It seems volatility is the leverage tool du jour...

 

 

Chart: Bloomberg

 

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Fri, 11/23/2012 - 12:50 | 3006624 Theta_Burn
Theta_Burn's picture

Someone stick thier head in that gators mouth....

Fri, 11/23/2012 - 12:50 | 3006625 slaughterer
slaughterer's picture

To be fair, the volume on HYG today is ridiculously low.  

Fri, 11/23/2012 - 12:55 | 3006643 Tyler Durden
Tyler Durden's picture

To be fair, the volume on stocks, which will be the lowest of the year, will be lower than Thanksgiving Friday a year ago.

Fri, 11/23/2012 - 12:56 | 3006646 DavidC
DavidC's picture

Tyler,
lol!

DavidC

Fri, 11/23/2012 - 12:59 | 3006654 economics9698
economics9698's picture

Print, print, and print.

Fri, 11/23/2012 - 13:06 | 3006675 LongSoupLine
LongSoupLine's picture

Nice Tyler!  That was a pleasant "fuck you idiot" if I've ever seen one.

Fri, 11/23/2012 - 13:13 | 3006700 A82EBA
A82EBA's picture

looks like michael jackson

Fri, 11/23/2012 - 15:02 | 3007064 Mudduckk
Mudduckk's picture

Lol

Fri, 11/23/2012 - 12:52 | 3006629 max2205
max2205's picture

Just let this short cover rally run out.

Fri, 11/23/2012 - 13:38 | 3006788 NaiLib
NaiLib's picture

:) its not a shot covering rally, its an ordered mark up to get cetain indices on the "right side" for those that act on T.A.. Including the algos. THis is so fun to watch. There is no "market" anymore. Just centrally planned index fixing.

Fri, 11/23/2012 - 12:57 | 3006649 magpie
magpie's picture

I knew i was at least one and a half days too early with my trade. Geppy is the riskmeister ftw

Fri, 11/23/2012 - 13:05 | 3006672 Water Is Wet
Water Is Wet's picture

What do stocks know that HY credit doesn't?  /arbitrary bias

Fri, 11/23/2012 - 13:54 | 3006847 TheCanadianAustrian
TheCanadianAustrian's picture

Similar headlines in the archives:

What Do Stocks Know That Bonds And FX Don't? - 11/16/2012 - 14:21
What Do JCP's Bondholders Know That Shareholders Don't? - 11/12/2012 - 11:08
What Do European Credit Markets Know That Stocks Don't? - 09/25/2012 - 11:09
What Do Stocks Get That Credit and Bonds Don't? - 08/16/2012 - 14:45
What Does High Yield Credit Know That Stocks Don't? - 08/13/2012 - 10:03
What Does Gold Know That All Other Asset Classes Don't? - 07/27/2012 - 09:41
What Do Treasuries Know That Stocks Don't? - 07/02/2012 - 09:34
What Do FX Traders Know That Stock Momos Don't? - 05/24/2012 - 22:39

And all those dates are a Monday, Thursday, or Friday. Since obviously no such article would be written on a day when markets are closed, what I want to know is this: ZeroHedge, why are you making this guy with a market fetish work the Thursday-Monday shift?

Fri, 11/23/2012 - 13:27 | 3006718 ekm
ekm's picture

Reminder to everybody:

 

- HFT can exist only if there are multiple exchanges

- HFT can exist only if real traders are trading electronically and HFT steals by getting in between via multiple exchanges latency.

- If only few real traders are trading, this is death for HFT.

- HFT doesn't really care whether the market is going up or down, all they care is that many, many, many real traders actually trade.

 

Hence, the crash cannot be caused by HFT. The crash will be caused by an imminent collapse of 1 or 2 primary dealers, but HFT will make sure the crash becomes a crater on the way down.

 

Terminology:

- Trader: a person/institution that HOLDS a security for a humanly measureable time like seconds, minutes, days or years and is capable of holding INVENTORY.

- HFT: a programmed machine that trades trillions of securities in a humanly unmeasureable milisecond and is programmed NOT to hold INVENTORY.


Fri, 11/23/2012 - 13:32 | 3006768 I am Jobe
I am Jobe's picture

Dammit, Print Ben, Fuck get off your fucking azz and te your bitch wife that you have work to do.

Fri, 11/23/2012 - 14:13 | 3006917 goldenbuddha454
goldenbuddha454's picture

The monday-thursday shift is when the issues that should be reported on and analyzed aren't by the mainstream media

 

Sat, 11/24/2012 - 12:27 | 3008441 DowTheorist
DowTheorist's picture

The stocks rally is highly suspect because of two reasons:

1. The rally of the last four days has been with declining volume. Volume is not confirming price action.

http://www.dowtheoryinvestment.com/2012/11/dow-theory-update-for-nov-23-...

 

2. The primary trend of the market is bearish. So the odds favor declining prices in the months ahead.

http://www.dowtheoryinvestment.com/2012/11/dow-theory-special-issue-afte...

 

So high-yield  credit is simply in line with the primary bear market in stocks.

 

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