For investors seeking momentum, Direxion Daily 7-10 Year Treasury Bear 1X Shares (TYNS - Free Report) is probably on radar now. The fund just hit a 52-week high and is up about 6% from its 52-week low price of $27.74/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
TYNS in Focus
This fund seeks to deliver the inverse of the performance of the ICE U.S. Treasury 7-10 Year Bond Index. The underlying index is market-value weighted and 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. TYNS charges 0.45% in expense ratio (see: all the Inverse Bond ETFs here).
Why the Move?
The Treasury corner of the fixed income world has been an area to watch given the spike in yields. This is because 10-year yields have jumped to 3.09%, marking its highest level since July 2011. A rise in energy prices, increase in raw material costs, and a historic low unemployment rate (which indicates that wages could finally pick up) have lifted inflation expectations, in turn fueling speculation of faster-than-expected rate hikes for this year. Since yields and bond prices have a negative relationship, Treasuries have beaten down and have thus benefited their inverse counterparts.
More Gains Ahead?
TYNS remains strong given a mediocre weighted alpha of 5.20% and a low 20-day volatility of 6.26%. As a result, there is definitely still some promise for investors who want to ride on this surging ETF a little further.
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