TLT
📉 The TLT ETF, representing long-term US Treasury bonds, has significantly underperformed, losing 5% recently and 50% over the last five years, failing its traditional role as a portfolio stabilizer.
🇨🇳 Major holders like China are selling US debt due to geopolitical tensions, putting downward pressure on bond prices.
🏦 Central banks face constraints; intervening to buy bonds and stabilize the market could exacerbate already high inflation, leaving bonds vulnerable.
@Artedeinvertir:
“Historically, the liquidity or bond part was considered the safe part of the portfolio, where in significant market or economic corrections, these bonds acted as a cushion and even increased in value. But the current crisis has been different, as bonds have decreased in value and have not provided that real refuge. The reason for this is that the recent conflict with China has caused this country to start selling sovereign bonds of the United States and Europe, and it is a real problem because China is the largest investor in American debt. In this Google graph, we can see how the main ETF of American bonds, which trades under the ticker TLT, has lost 5% of its value in a few days, and over the last 5 years, it accumulates drops of 50%. Historically, what central banks did during this type of crisis was intervene in the debt market and buy this debt sold by other countries to stabilize the system. However, currently, given that inflation is at a very high level, if they did this, inflation could rise even more, so they are waiting to see what happens.”
Watch the exact part of the video where @Artedeinvertir talks about iShares 20+ Year Treasury Bond ETF here:
Watch the video on YouTube
Read more articles analyzing iShares 20+ Year Treasury Bond ETF (TLT) at the provided link. TLT stock.
