Bob Elliott
· Nonconsensus
· July 13, 2026 at 19:00
| Read on Substack ↗
Summary
Bob Elliott is closing his thematic trade that bet against rate hike expectations, which was based on a Memorandum of Understanding signaling the reopening of the Strait of Hormuz and lower inflation pressures ahead. The author notes he probably should have hedged the trade with oil, implying a missed risk management opportunity. For markets, the close of this trade suggests a re-evaluation of rate hike pricing and potential oil price volatility.
•The trade was opened based on a MoU signaling intention to have Hormuz open and lower inflation pressures ahead, which the author believed was mispriced in rates markets.
•The author is now closing the trade, indicating a change in conviction or that the thesis has played out.
•The author acknowledges he probably should have hedged the trade with oil, given the direct impact of Hormuz reopening on oil supply and prices.