Bank of Canada recently announced reduction in its prime rate. As a Canadian, is there a way to take advantage of it? For example, if I bet that in the next 12 months, the rate would increase, how can I make money on this bet?
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1Short sell long term bonds?– EkoostikMartinJan 22, 2015 at 23:00
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@EkoostikMartin - I was going to suggest buying puts on the long bond.– JTP - Apologise to Monica ♦Jan 22, 2015 at 23:28
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Another option is to buy non-Canadian currency you think will do better– jlewkovichJan 23, 2015 at 0:51
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@JL a rising rate can attract foreign money and actually cause the Looney to rise, not fall.– JTP - Apologise to Monica ♦Jan 23, 2015 at 3:09
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@JoeTaxpayer: Can you elaborate please? What do you mean by long bond?Is there a bond etf for this (like XBB)?– Victor123Jan 23, 2015 at 15:23
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