A Retired Trader Tries to Make It Easier to Hedge Treasury Debt
Investors rely on CME’s futures to manage bond risk, but “it’s not an optimal design.”
Chas Mancuso spent the first 20 years of his Wall Street career learning the head-spinning ins and outs of Treasury bond futures and teaching customers how to make money with them. He’s spent the past seven years on a crusade for a better way.
The 59-year-old former trader, who moved from New York to Myrtle Beach, South Carolina, in 2016, could devote all his time to golf, pickleball and flipping town homes if he chose to. Instead he spends hours on the phone and in meetings trying to convince Wall Street dealers—his former customers—as well as institutional investors and regulators that the gargantuan US government bond market should scrap the risk-hedging mechanism the Chicago Board of Trade created in 1977 in favor of the simpler one he devised. Mancuso and his partners at Next Level Derivatives LLC have secured patents and a list of prominent backers for what they call Treasury Risk Forwards, or TRFs (pronounced “turfs”) for short.