Treasury Update: 30-Year Massacre

The 30 Year Treasury dropped over 250 bps today ato 123.04 last, for a yield of 3.267%, the highest yield since December 3. TBT longs everywhere rejoice. Sphere: Related Content

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ETF Pick of The Day: TBT

Thank you Fast Money for pushing our other ETF pick and holding - double negative on treasuries but no negative carry: you get a dividend if you care about that kind of stuff. Cheap entry point at $40.33, with historical average $61.03. Thesis: the sell off in treasuries once people go back to risky assets, or once everyone stops buying them. China, Russia, Japan and Europe will have massive internal budget deficits to fund to care about buying treasuries, and the US can only print so much money to buy its own paper. Plus yields on Treasuries can only go to 0, which is pretty much where they are now.

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ETF Pick of the Week: SRS

Zerohedge has invested its collective $0.69 (this by the way is also our disclaimer that we are unabashedly pushing our book) in the SRS ETF. SRS is an ultra short fund, double inverse tracker of the Dow Jones U.S. Real Estate Index. We would post the links that disclose the current state of the U.S. residential and commercial mortgage markets but frankly unless you have been living in 740 Park for the past 2 years, you should have an idea by now.

Technicals are sweet, with this baby hitting $260 the last time Citi was at this price so there is some nice post short squeeze upside... Top 10 Index constituents of the 79-company fund, are such future DIP hunters as Simon Property Group (7.76%), Vornado Realty (4.69%), Public Storage (4.56%), Equity Residential (4.31%), Boston Properties (3.99%), ProLogis (3.87%), HCP (3.59%), Plum Creek (3.08%), Kimco Realty (2.90%) and Avalonbay (2.71%). The P/E ratio as given by proshares is 15.89x, and a 5.28% dividend yield... We would probably recommend selling once it hits the low to mid 200s for a nice 3x return. Start buying.

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