The Tell: Hedge fund boss who predicted the 1987 stock crash warns of a selloff in bonds

Paul Tudor Jones, a hedge-fund icon, said investors should steer clear of bonds as he considers government paper “overvalued and overowned” and primed for a tumble.

That’s a scenario that would drive yields, which move in the opposite direction of prices, sharply higher. Jones is predicting the yield for the 10-year Treasury note TMUBMUSD10Y, +0.62% will hit 3.75% by the end of 2018. Yields stand presently at 2.81%.

Source: via Goldman Sachs Feb. 28 report

Jones is widely credited with predicting, and profiting, from the stock-market crash in October of 1987, which saw the Dow Jones Industrial Average DJIA, -1.68% lose 22% of its value, marking the largest percentage decline for the blue-chip benchmark in its history.

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