The Proshares UltraShort 20+ Year Treasury ETF (TBT:NYSE) has proven immensely popular, with average daily volume above 5 million shares. TBT is designed to rise when long bond prices fall. Thus, to go long TBT is to cast a predictive vote for rising interest rates, rising inflation expectations, and deteriorating credit conditions fueling a loss of faith in Uncle Sam.
The thing is, the logic behind this trade may have become too obvious. When that happens, the odds of a nasty correction increase significantly.
Blogged with the Flock Browser