ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Gold/Silver/Critical Minerals
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Modern Alpha
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About VettaFi
    • Get VettaFi’ed
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Leveraged & Inverse ETF Channel
  2. Investors Looking Past Omicron Might Push Yields Higher, Bonds Lower
Leveraged & Inverse ETF Channel
Share

Investors Looking Past Omicron Might Push Yields Higher, Bonds Lower

Ben HernandezDec 22, 2021
2021-12-22

Even as COVID-19 cases start to rise due to the more contagious Omicron variant, investors may be looking past the associated market risks.

As the Dow Jones Industrial Average moves higher after last week’s volatility, the bond markets are responding favorably. Yields are ticking higher and bond prices are moving lower, potentially signaling a move from safe haven assets.

“Omicron is a threat, but it’s not going to derail things,” said Tufts University economist Brian Bethune.

While the variant may be more contagious than the previous Delta variant, the notion is that symptoms are often more mild. As the markets continue to digest COVID news, more confidence could be building, which could result in a year-end rally.

“The market seems to be reacting to a short-term oversold position,” said Timothy Lesko, principal at Granite Investment Advisors. “Omicron and its unknown effect is creating significant volatility. Bonds were over bought, stocks were over sold and now we seek to find answers.”

“If omicron-induced illness remains mild, which seems to be of some debate, we could see a rally,” Lesko added.

2 ETFs to Trade the Moves

Yields react conversely with bond prices, and traders can play the moves with a pair of inverse funds from Direxion Investments. Both ETFs use benchmark Treasury yields in the shorter-term seven- to 10-year maturity dates and the longer-term 20-plus maturity dates.

First off, there’s the Direxion Daily 7-10 Year Treasury Bear 3X Shares (TYO B), which seeks daily investment results before fees and expenses of 300% of the inverse (or opposite) of the daily performance of the ICE U.S. Treasury 7-10 Year Bond Index. The index is a market value-weighted index that includes publicly issued U.S. Treasury securities that have a remaining maturity of greater than seven years and less than or equal to 10 years.

Next, traders can use the Direxion Daily 20+ Yr Trsy Bear 3X ETF (TMV A), which seeks daily investment results equal to 300% of the inverse of the daily performance of the ICE U.S. Treasury 20+ Year Bond Index. TMV invests in swap agreements, futures contracts, short positions, or other financial instruments that provide inverse or short leveraged exposure to the index, which is a market value-weighted index that includes publicly issued U.S. Treasury debt securities that have a remaining maturity of greater than 20 years.


Content continues below advertisement

Direxion Daily ETFs

For more news and information, visit the Leveraged & Inverse Channel.

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X