I rate SGOV (iShares 0-3 Month Treasury Bond ETF) a Buy for cash needed within 12 months, and TLT (iShares 20+ Year Treasury Bond ETF) a Hold. TLT's 5.7% yield is attractive, but its extra income only offsets about 11 bps of long yield increases over 12 months. SGOV offers nearly 4% yield with minimal price volatility, making it preferable for short-term needs amid rate uncertainty.
The Fed voted unanimously to raise rates in September, but the bigger question is what a surprise jobs report and an AI spending surge mean for the next meeting and for anyone holding SPY or TLT right now.
Fed rate-hike odds swung violently in a single week, but the jobs data behind that swing raises as many questions as it answers, and long-bond investors may be celebrating too soon.
The government needs buyers for a massive wall of long-term debt at borrowing costs not seen in over two decades, and weak demand at even one auction could deepen losses already punishing bond holders.
Bloomberg's top ETF analyst watched billions flood into a battered Treasury fund and did something unusual for a market commentator: he told investors to walk away, then admitted his own track record proves exactly why.
The iShares 20+ Year Treasury Bond ETF (TLT) continues its strong freefall, reaching its lowest level since September 2023 as cracks in the bond market accelerated. TLT plunged to $77, down 11% this year and 46% in the last five years.
For two generations of savers, the 30-year Treasury was the steady part of a portfolio: dull, safe and reliably positive over time. That assumption no longer holds.
Long-duration Treasuries have shed more than half their peak value, and retail investors keep loading up expecting a rate reversal that refuses to arrive.
Treasury yields just hit levels the bond market has not seen since before the financial crisis, and the pain is spreading fast into corners of the market most investors assumed were safe.
My mentor always told me never to speculate on rates, but today I'm looking at TLT with interest. Current 20-year yields around 5.3% look elevated relative to Fed inflation and neutral rate projections. Elevated margin debt and record household equity allocation point to a widening equity risk premium, favoring bonds over stocks.
On the morning of a Federal Reserve decision Wall Street has priced as a near-certain rate hike, $7 billion rushed into the iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT), a fund that has lost roughly a third of its value
Long Treasury yields just hit levels not seen since 2007, and the usual rescue plan from the Fed is nowhere on the horizon.