Betting Against Treasurys? Think Again

A common strategy for 2010 was to bet against Treasury bonds.  The thinking was that a recovering economy would lead to rising interest rates according to WSJ columnist John Spence.

However, the rising rates have failed to materialize and bets against treasurys have suffered big losses according to Spence.  In fact, the iShares Barclays 20+ Year Treasury Bond Fund (TLT) has actually gained 10% year to date.

Other ETFs that have suffered in the face of strong treasury prices include the ProShares UltraShort 20+ Year Treasury (TBT) and the Direxion Daily 30 Year Treasury Bear 3x Shares (TMV).

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