Is Thursday’s 30-Year TIPS Reopening Another Halloween Scare?

Summary

  • Buy-and-trade investors ought to be at least a little frightened; 30-year TIPS are very volatile investments.
  • The real yield for this TIPS is currently trading very close to the 0.875% coupon rate. It should auction at close to par value, plus accrued inflation.
  • The inflation breakeven rate is about 1.93%, which I consider ‘fair value’ versus a 30-year nominal Treasury.

Read my full analysis on SeekingAlpha.com

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