Playing the Treasuries rush

Profit from Moody's recent downgrade of Ireland.

By Wall Street Media on MSN Money Dec 17, 2010 5:43PM

Written by Douglas Estadt


Moody’s (MCO) downgraded Ireland Friday, which resulted in a mad rush to buy U.S. Treasuries. This reaction is startling due to the fact that the term PIIGS (describing doomed European countries) has been tossed around for some time.  


PIIGS is an acronym describing the struggling economies of Portugal, Italy, Ireland, Greece and Spain.


Option pinning could be the culprit, and investors are likely affected by the decision from Moody’s. We profit by buying ProShares UltraShort Lehman 20+ (TBT), which is the inverse short ETF.


TBT corresponds to twice the opposite of the daily performance of the Barclays Capital 20+ Year U.S. Treasury Bond Index.


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