Citi Considers "Old School" Hedge Options, Likes HY Swap

Citi analysts Stephen Antczak and Jung Lee have been fielding an unusually large number of hedging questions recently, as a Fed rate hike looms, a Greek tragedy could emerge again as new elections are called and the stock market over the past few days has exhibited weakness.

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The search for the best “hedge” finds a swap product

The pair searches for the illusive “best” hedging method for “an old school high-yield portfolio manager that is willing to spend a certain amount on a hedge.” This sentence shows an approach taken to hedging: it can be a cost. Professional...