For investors looking for momentum, the SPDR Bloomberg Barclays Intermediate Term Treasury ETF (ITE - Free Report) is probably on your radar now. The fund just hit a 52-week high and shares of ITE are up roughly 3.4% from their 52-week low price of $57.60/share.
But could more gains be ahead for this ETF? Let’s take a quick look at the fund and the near term outlook to get a better idea on where it might be headed:
ITE in Focus
This ETF reflects the price and yield performance of the Bloomberg Barclays 3-10 Year U.S. Treasury Index. Due to its intermediate term focus, it is less sensitive to interest changes than its long-term counterparts. The fund comprises 114 holdings with an average maturity of 5.63 years and option adjusted duration of 5.17 years. It charges 10 bps as fees (see: all the Government Bond ETFs here).
Why the move?
The government bond space has been an area to watch lately given the ongoing market turbulence. Wall Street concluded trading in 2018, with all major stock indexes registering their worst yearly performances since the financial crisis. This made investors flock toward this safe haven. Also, the fund has gained traction because short-term rates have risen more than long-term rates. Thus, investors have preferred long and mid-term bonds over short-term bond.
More Gains Ahead?
Currently, ITE has a Zacks ETF Rank #4 (Sell) with a Medium risk outlook. However, a positive weighted alpha of 1.6 and a moderate 20-day historical volatility of 2.98% indicate that there is definitely still some promise for investors who want to ride on this surging ETF a little further.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>