The best sources are typically institutional, but there are also public or semi-public platforms that provide solid visibility. Bloomberg and IHS Markit are both options.
Currently working on some products for subscribers to access soon, though.
If it wasn’t for me watching “the big short”, this would’ve been hard to follow. Thank you for writing this easy-to-follow primer on an obscure financial instrument.
The movie gives a very good basic overview of what CDS are and what happened in ‘08, but we’re glad you found this one beneficial as we go more in-depth on the topic.
Thorough primer on CDS mechanics and their role as a credit risk signal. This kind of institutional risk-transfer plumbing often trickles down to corporate credit conditions—shaping trade terms, supplier financing costs, and working capital liquidity for B2B firms. TCLM explores that downstream layer, where credit market dislocations meet operational cash flow and risk policy. A solid read for finance teams monitoring macro-credit linkages.
I have a quick question, is it possible to graph multiple similar names together and use the plots to assess which names are trading cheap or rich?
For instance, if we plot the USD senior CDS curves for the major Australian banks (ANZ, CBAUU, WSTP, and NAB), could we then look at, say, the 4-year tenor and observe that WSTP’s spread is higher relative to peers , implying that WSTP is trading wider and therefore appears cheap?
Thank you for the fascinating article. What is the best website or index for a macro enthusiast to follow the CDS of USA and European countries?
The best sources are typically institutional, but there are also public or semi-public platforms that provide solid visibility. Bloomberg and IHS Markit are both options.
Currently working on some products for subscribers to access soon, though.
If it wasn’t for me watching “the big short”, this would’ve been hard to follow. Thank you for writing this easy-to-follow primer on an obscure financial instrument.
The movie gives a very good basic overview of what CDS are and what happened in ‘08, but we’re glad you found this one beneficial as we go more in-depth on the topic.
“Any way to do 200 million?”
"The five-year is trading just above 43bps. This means that for every $1m notional bought, a 0.43% premium is paid annually."
"As mentioned above with JPM, on a $1m notional, that’s circa $43k per year or $10.75k per quarter."
43bps on $1m is $4300.
Glad readers can pick up on this. The fine details get missed 4,000 words into a primer and self-checking, haha.
Good article. Thanks.
How picking up nickles in front of steam rollers was existentially destructive to the CDS writers before the GFC. And to the world financial system.
Wonder if anyone has learned anything. Other than the existence of Uncle Sam's put. Hopefully.
thank you
Thorough primer on CDS mechanics and their role as a credit risk signal. This kind of institutional risk-transfer plumbing often trickles down to corporate credit conditions—shaping trade terms, supplier financing costs, and working capital liquidity for B2B firms. TCLM explores that downstream layer, where credit market dislocations meet operational cash flow and risk policy. A solid read for finance teams monitoring macro-credit linkages.
(It’s free)- https://tradecredit.substack.com/
Great read once again!
I have a quick question, is it possible to graph multiple similar names together and use the plots to assess which names are trading cheap or rich?
For instance, if we plot the USD senior CDS curves for the major Australian banks (ANZ, CBAUU, WSTP, and NAB), could we then look at, say, the 4-year tenor and observe that WSTP’s spread is higher relative to peers , implying that WSTP is trading wider and therefore appears cheap?
Where are the movements here?