This Long Straddle Can Cash In If Bond Volatility Heats Up

If long-term bond yields — or equivalently, the iShares fund price — make a sharp move in either direction, potential gains can be substantial, potentially multiples of the initial investment. There's finally some volatility returning to the stock market, with the Cboe Volatility Index spiking above 20 for the first time since June. Bond volatility has also ticked higher, but it remains relatively subdued. For investors anticipating increased volatility in longer-dated bonds, a long straddle in the iShares ...