Strategy
The case for going out the curve
If term premium is the story, the reward for duration is finally worth the volatility.
For two years, duration has been a tax. Every extension out the curve came with a volatility bill that the carry could not cover. That math is starting to change.
Paid to wait, at last
With term premium rebuilding rather than compressing, the long end is offering compensation for risk that simply was not there in the flat-curve regime. The reward for going out the curve is no longer purely a bet on cuts — it is a bet on being paid to hold duration through the noise.
That does not make it a comfortable trade. But for the first time in this cycle, the volatility is priced, not assumed away.