Wednesday, March 9, 2011

Inverse Fund the Perfect Play for a Bond Bubble Burst

The ProShares Short 20+ Year Treasury ETF (NYSE: TBF ) is your best bet to profit from the end of the Fed’s quantitative easing policies, and what some are fearing will be a massive bond bubble. This fund moves inverse (opposite) to the daily performance of the Barclays Capital 20+ Year U.S. Treasury Bond Index.  The price of Treasury bonds will fall when the Fed increases interest rates and QE2 expires. Since history has shown that it is usually better to go with the Fed's policies, this appears to be an investment that could offset the impact of future Fed policy changes. The target for TBF is $50, but buyers should be prepared to hold TBF as a hedge against lower bond prices and higher interest rates. If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net .
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