Bears Just Can't Refuse Bet Against Bonds

Although longer-term U.S. debt has gained 14 percent this year, money continues to pour into ETFs based on longer-term Treasuries.

You’d think investors would sour on a bet against bonds that’s lost 25 percent in seven months. Turns out some people have a very high tolerance for pain.

Investors have poured $1.1 billion into the ProShares UltraShort 20+ Year Treasury exchange-traded fund (ETF) this year, undeterred by the third-worst performance among all U.S. fixed income ETFs. The fund, which acts as an amplified bearish wager on longer-term U.S. Treasuries, has received $49 million in the past week alone and is the eighth-most popular ETF among its peers in 2014, according to data compiled by Bloomberg on flows.

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