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Quantitative Finance · Glossary

What is Supply trade?

Definition 13.3 Strategies II: Volatility, Relative Value, Macro and the Bank Desks · Chapter 13 — Supply Trades

A supply trade takes the opposite side of known, scheduled supply: short (or underweight) the securities about to be issued and their close substitutes before the sale, long after it, paid by the issuer’s and the dealers’ need to distribute the supply.

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