Direxion Daily 30Y T (AMEX:TMF)

It is time again to short government debt ETFs and begin laddering put writes at successively lower strike prices as your time horizon extends forward. However, try not to be too aggressive with your risk exposure this time around as the U.S. debt market is much closer to a destabilizing event. Do not begin writing on TMF until it drops under 72.

Bond yields are too low. Now that stocks are coming back in earnest, quite a lot of bonds are going to be sold so that smart money can buy stocks.

Argghh.

I had thought (and still think) long-term Treasuries are in a bubble.
www.fool.com/investing/general/2012/01/05/treasuries-vs-stocks-running-the-numbers.aspx
www.fool.com/investing/dividends-income/2011/05/26/stocks-vs-bonds-for-income-lets-rumble.aspx
http://www.fool.com/investing/general/2010/08/03/bond-bubble-brewing.aspx

So far, that opinion has been wrong and makes TMF my all-time worst CAPS pick.

But, I have faith that rock bottom bond yields will someday creep out of the gutter. Combine that with friction in a triple leveraged ETF and I think this pick will turn out ok. Just might have to wait a while, maybe quite awhile.

Treasuries? Way overvalued.

This one might take a while to materialize, with lots of losses in between, but treasuries go down in the not too distant future.

alert 50d to consider exit

treasury rate yield just too low to be sustained.

Long term treasury interest rates are near the end of a long term secular bull market. There is simply too much supply and too much potential for rising interest rates.

With the coming end of QE2's support of the markets and the spectre of rising interest rates, treasuries are due for an extended fall. These leveraged short-timer daily-balanced ETFs come with an extra advantage on the short-side - they can still lose value even if the general trend is up.

As an added bonus, I like the irony of shorting TMF!

Gross is short on USTs.

First, I think that long term U.S. debt will be falling quite a bit. I should have picked this awhile ago but whatever, there's still plenty of room left to fall.

Second reason I'm shorting this instead of longing the inverse fund is that these leverage funds are always getting burned by compounding. In the long run, the only way this pick loses is if U.S. treasuries consistently climb. Even a jump and then flat will eventually earn me points after compounding takes its toll.

tmfeldrehed

Treasury yields are surely headed back to their end-2008 lows. This is the best play out there to capitalise on the move.

Treasury bubble

Eventually rates will go up, and the "flight to safety" will end. Add in the contago effect, and this will be a great long term short.

The 2.20 dividend is smoke and mirrors, trying to convince investors that there's more to this company than there really is.

rates hammered

-1 (US$ 419.65) May 10 38 call
-1 (US$ 419.65) May 10 39 call
+1 (US$ 419.65) May 10 39 put
+1 (US$ 419.65) May 10 40 put

Long term interest rates are heading up, whether the Fed likes it or not. This fund tracks 3x the movement in the 30 year Treasury.