Stockchase Research Editor: Michael O'Reilly We reiterate this defensive holding as a hedge against a pending recession as a TOP PICK. It holds 20-30 year US treasuries. As interest rates are expected to be nearing peak values this is a good entry. US 30 year treasury yields remain within 50 bps of the levels reached prior to the 2008 financial crisis. We recommend trailing up the stop-loss (from $80) to $92, looking to achieve $150 – upside potential over 40%. Yield 2.4%
A long volatility strategy. Down 30% from its high. Continue to hold. Don't look at the day-to-day moves, look for big exponential moves. The only 2 long volatility strategies left are gold and long bonds. This is only the third time in the last 100 years that both gold and bond prices are going down at the same time. The last 2 times this happened, major monetary events happened. Something's about to break or change monetarily, though we don't know what that is. This situation cannot continue. A major policy response needs to happen fairly quickly. Upcoming US mid-terms are reminiscent of 1994, the Contract with America, and the top of the bond market. That was the last treasury bear market until this year, an eerily similar setup.
Stockchase Research Editor: Michael O’Reilly A good defensive holding as a hedge against a pending recession. It holds 20-30 year US treasuries. As interest rates have risen it has naturally gone down in value. US 30 year treasury yields are within 50 bps of the levels reached prior to the 2008 financial crisis. We recommend placing a stop-loss at $80, looking to achieve $150 – upside potential of 60%. Yield 2.6%
Good option for investors.
US Dollar is usually benefactor of investors looking for safety.
Also get strong yield as interest rates increase.
Shares currently presenting good buying opportunity.
Inverted rates at the long end mean the market's telling you high probability of a recession. Not a bad entry point to dip your toe in. Curve might re-steepen temporarily, if inflation is stickier. Partial position now; if he had $1, he'd put 50 cents in right now.
The market thought the Fed pivoted, so the market rallied. But what happens if the Fed doesn't engineer a slowdown? Well, they will slam on the brakes by hiking rates hard. The Fed has burst some bubbles, like cryptos, but more need to be burst. He bought bonds for the short-term. TLT is probably the place to be.
Best ETF to get exposure to 30-year Treasury bonds. Trades 20 to 30 years fixed income. This is the one he uses. More aggressive option with 25+ year maturity remaining is ZEROZ-N. ZTL-T is also an option in Canada that can allow to hedge the currency risk. Keep in mind that if inflation wins and Fed misses, you don't want to hold long bonds.
(A Top Pick Mar 17/22, Down 6%) We'll get deflation first, he thinks, then hyperinflation. TLT is there for emergencies, like massive deflation, when TLT will rally, then he would take gains. These are long-volatility assets that could do spectacularly in the future.
In his portfolio, he's put equal measures of PHYS and TLT. Buy this with USD. This and gold are the only 2 asset classes left that can play the long volatility strategy. If you have the two together, it eliminates all possibilities. If we have major deflation, gold will get hit, but TLT will go spectacularly up. Or vice versa, if we have hyper-inflation.
(A Top Pick Mar 08/21, Down 0.9%) Believes best hedge against equities for Canadian investors.
US Treasury is one of highest quality investments available.
If/when equity markets drop, believes shares will rise.
If looking to reduce volatility, will be a good investment.
(A Top Pick Oct 19/21, Down 6.5%)Stockchase Research Editor: Michael O’Reilly Our PAST TOP PICK with TLT has triggered its stop at $135. To remain disciplined, we recommend covering the position at this time. This will result in a net investment loss of 5%, when combined with the previous buy recommendation.
Stockchase Research Editor: Michael O'Reilly We reiterate TLT as a precautionary holding, to protect in the event of another market retracement. TLT is an ETF that represents US 20 long term treasury bonds of a term of 20+ years. Yields on long term treasuries have rebounded back to 2.00% making this another good entry point. We now recommend setting a stop loss at $135. Yield 1.51%
iShares 20+ Year Treasury Bond ETF (TLT) Frequently Asked Questions
What is iShares 20+ Year Treasury Bond ETF stock symbol?
iShares 20+ Year Treasury Bond ETF is a American stock, trading under the symbol TLT (previously TLT-Q on Stockchase) on the NASDAQ (TLT). It is usually referred to as NASDAQ:TLT or TLT
Is iShares 20+ Year Treasury Bond ETF a buy or a sell?