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Wednesday, December 10, 2008

Treasury ETFs

One way to trade the treasury market without actually buying or selling treasuries is through ETFs. I went to stockcharts' symbol catalog and entered "treasury" and this is the list of ETFs I got (I also got the symbols for the indexes, which are good to know if you need to track them). I don't know how comprehensive this list is, but there are quite a few to chose from.

TLT is probably the best known and most heavily traded. Like any other ETF, you can sell it short, and I believe there are options on it, too. This one tracks the 20 year treasury, and goes up as the yield goes down.

TBT is the ultra short version. If you prefer not to short (or trade in a cash account), you can go long this instead. It is also shortable and I believe optionable. It goes in the same direction that yield goes. If treasuries are indeed the next bubble to pop, this would be a good way to go.

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