This strategist correctly recommended shorting Big Tech debt last year. Now he says the yields make it attractive.

A strategist who recommended shorting Big Tech debt last year has reversed his view, arguing that current yields make the bonds attractive again. Yields on tech bonds now range from 6% to 8%, a level that, in his assessment, offers more competition against stocks than before.

The shift is best understood through relative value. When bond yields were lower, investors had little incentive to hold tech credit over equities. At 6% to 8%, the income available from these bonds changes that calculus: fixed-income investors are now compensated more meaningfully for taking on corporate credit risk, and the bar for preferring stocks has risen.

For market watchers, the key takeaway is that yield levels, not just credit quality, are driving sentiment toward Big Tech debt. The main things to monitor are whether yields hold in this range and how spreads behave if conditions shift. A move back toward lower yields could quickly erode the case the strategist is now making, just as last year's short call depended on the yield environment at the time.