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Is The Bull Market For Treasury Bond ETFs Really Over?

08 November 2011 at 11:56 am by Staff     Bookmark and Share    Follow EtfExpert on Twitter

What happened to the high likelihood of a double-dip recession? It seems to have faded from bearish commentary. What happened to the notion that European policymakers would fail to agree on a plan for containing the sovereign debt virus? It appears that cooler heads are prevailing.

Not surprisingly, one is likely to read a fair amount of cautious optimism for stock assets. In fact, a large majority of Stock ETFs have eclipsed respective 50-day moving averages; meanwhile, the S&P 500 SPDR Trust (SPY) is currently trading above a 200-day trendline.

SPY 200-Day

If the environment for stocks is genuinely improving, however, then why are Treasury Bond ETFs catching a collective ”second wind.” Whereas one might view 10-year yields of 2% and 30-year yields of 3% as preposterously low, treasury bonds are still winning.

For example, the iShares 7-10 Year Treasury Bond Fund (IEF) sank deep below a 50-day moving average in October. Here in November, though, IEF is already back above an intermediate-term trendline.

ief 50

Fixed Income ETFs Bounce Back – Bespoke
Bullish On Brazil: Comparing 2 Small-Cap ETFs – Richard Bloch, Seeking Alpha
Bottoms Up For 4 Promising Equities – Tom Aspray, Forbes
XLF: Banking On A Turn Around? – Skip Raschke, The Street
Four International Mid-Cap ETFs Your Broker Forgot To Mention – ETF Professor, Benzinga

  

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Disclosure Statement: ETF Expert is a web log (”blog”) that makes the world of ETFs easier to understand. Gary Gordon, MS, CFP is the president of Pacific Park Financial, Inc., a Registered Investment Adviser with the SEC. Gary Gordon, Pacific Park Financial, Inc, and/or its clients may hold positions in the ETFs, mutual funds, and/or any investment asset mentioned above. The commentary does not constitute individualized investment advice. The opinions offered herein are not personalized recommendations to buy, sell or hold securities. At times, issuers of exchange-traded products compensate Pacific Park Financial, Inc. or its subsidiaries for advertising at the ETF Expert web site. ETF Expert content is created independently of any advertising relationships. You may review additional ETF Expert disclosure details here.

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