Traders eye negative CDS-bond basis
Changed market dynamic can be profitable for those firms able to capture it
A measure of divergence between credit default swap spreads and equivalent credit spreads on European corporate debt has dipped below zero for the first time in nearly four years, spurring trading activity for those able to take advantage of the difference.
The aggregate CDS-bond basis for investment grade European corporate debt, measured as CDS spreads minus the credit component of bond yields
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