Latest news with #iShares10-20YearTreasuryBondETF
Mint
25-06-2025
- Business
- Mint
Investors returned to US long-term bond funds in May
By Patturaja Murugaboopathy June 25 - U.S. long-term bond funds drew massive inflows in May, reversing April's drawdown and indicating investors sought the safety of higher-yielding debt, as they weighed a host of uncertainties around trade tariffs, inflation and fiscal deficits. According to Morningstar data, U.S. long-term bond funds attracted $7.4 billion in May, their largest monthly inflow in over two years, after facing sharp outflows in April. Jeana Doubell, fixed income analyst at Morningstar, said inflows into long-term bond funds in May reflect investor expectations of weaker growth and a view that bonds offered better value than other riskier assets. U.S. long-term bonds were sold off heavily in April on concerns that U.S. tariff measures could fuel inflation, while expectations that President Donald Trump's tax bill could inflate the deficit and Treasury supply added to the pressure. However, analysts said those concerns have eased as trade talks progress, rekindling appetite for long-term bonds. "Long-bond prices are susceptible to inflation, and recent data shows very little inflation above the Fed's 2% target," said Chris Gunster, head of fixed income at Fidelis Capital Partners. "As long as inflation is less of a concern, then long-dated Treasuries should reassert themselves as a hedge against equities and other risk asset declines." "The smart investors should already be locking in longer-term rates," he said. The Morningstar data showed short-term bond funds saw $5.8 billion in outflows after strong inflows the previous month, while intermediate-term bond funds attracted $4.2 billion. iShares 20 Year Treasury Bond ETF led with inflows of $4.3 billion, while iShares 10-20 Year Treasury Bond ETF and iShares 7-10 Year Treasury Bond ETF received $1.2 billion and $625 million, respectively. This article was generated from an automated news agency feed without modifications to text.
Yahoo
27-05-2025
- Business
- Yahoo
‘Widow Maker' Bond-ETF Trade Delivers Fast Gains for Dip-Buyers
(Bloomberg) -- Dip buyers in the dangerous world of long-dated Treasury debt are enjoying a rare pay day — and fast. UAE's AI University Aims to Become Stanford of the Gulf Pacific Coast Highway to Reopen Near Malibu After January Fires NY Wins Order Against US Funding Freeze in Congestion Fight Investors over the past week poured $1.8 billion into BlackRock Inc.'s iShares 20+ Year Treasury Bond ETF (ticker TLT) — the most among all the 630 ETFs that Bloomberg tracks — just as longer-maturity government bonds sold off on fears over America's debt trajectory. The timing has proved fortuitous. In Tuesday trading, Treasuries rallied — pushing the 30-year yield below 5% — on optimism about trade negotiations between the US and the European Union, and as Japan signaled it may adjust debt sales to stabilize its bond market. TLT jumped 1.7% during the session, on track for its biggest daily rise since February. It's a rare win for an ETF trade that has earned a reputation as a so-called widow maker. True to its infamy, TLT has attracted some $49 billion in the past five years despite shedding more than 40% in that time horizon. 'Investors aren't letting TLT's widow-maker reputation scare them off,' said Athanasios Psarofagis, ETF analyst at Bloomberg Intelligence. 'They're still buying in, holding on to hope that long-term Treasuries will finally bounce back.' For some time, bond investors have been demanding extra compensation for the risk of investing in longer-duration debt as Republican lawmakers haggled over President Donald Trump's signature tax-cut bill that would add trillions of dollars to already bulging budget gaps. Benchmark 30-year Treasury bonds surged above 5.1% last week to trade near the highest in almost two decades. But last week's buying streak in TLT suggests that a growing cohort of traders are betting that yields are high enough to entice buyers and compensate for the risks. Long-maturity bonds are most exposed to interest-rate risk, so they tend to rally the most when borrowing costs fall. 'Dip-buyers are trying to pick the bottom,' and long-term bonds give investors 'the biggest bang for your buck' because they are exposed to the most volatile part of the yield curve, said Byron Anderson, head of fixed income at Laffer Tengler Investments Inc. The iShares 10-20 Year Treasury Bond ETF (TLH) was also among the ETFs that attracted the most inflows over the past week, along with the iShares 0-3 Month Treasury Bond ETF (SGOV). Peter Tchir of Academy Securities is among those recommending long-bonds, saying the pessimism is overdone. Adding heft to his belief is the rally in global bonds after Japanese authorities signaled they are considering adjusting their debt plan. 'The situation wasn't as bad as the narrative,' said Tchir who recommended investors add duration last week. 'Positioning had swung from too bullish to too bearish fairly quickly, too.' Of course, TLT — which is almost as volatile as US stocks — isn't for faint hearts. In the options market, traders remain wary of further declines in long bonds. It costs more to buy put options in TLT than to purchase calls, a sign there is demand for downside protection. 'We believe the long end will continue to see term premium increase,' said Lindsay Rosner, head of multi-sector fixed income investing at Goldman Sachs Asset Management. 'It's all about the fiscal, what is the right level to lend at to countries whose balance sheets are trending the way they are.' Mark Zuckerberg Loves MAGA Now. Will MAGA Ever Love Him Back? Why Apple Still Hasn't Cracked AI Inside the First Stargate AI Data Center Millions of Americans Are Obsessed With This Japanese Barbecue Sauce How Coach Handbags Became a Gen Z Status Symbol ©2025 Bloomberg L.P.
