Can You Trade Bonds With ETF?

Hubert Senters here. Had a question from a viewer. This is from Mac on Hubert 2-18-21 daily video. He suggested we could use TLT to short the 20-year bond or TBT to go long the 20-year bond. Is there subsitute for the 30-year bond? Thanks Mac. Mac, to my knowledge there’s not a 20-year for a long or short. This is an ETF. So the bond markets that I trade the most are the TY. This is the 10-year Treasury Note. Or the US is the 30-year bond. Now, there’s a bunch of different ones. I’m going to show you that are available for in the futures market. There’s the bund. I trade that one. There is the 5-year, 5-year Treasury Note. There is the 10-year. There’s the 30-year and then there’s the 2-year. There’s not a 20-year to my knowledge. I could be wrong but I’ve been trading these things for a minute. What they do in the ETF, TLT is in iShares 20-year plus Treasury bond so it’s probably a blend of 20 years or longer. And then the TBT will go in the opposite direction. Now, what you could do if you want to do you can Google and the website that I use the most for ETFs is called ETF DB for ETF Database. These are the ones that are listed over there. So you could go. That’s on the second page. Let me go back to the first page. So you could go AGG, BND, LQD, VCIT, BNDX. All of these are ETFs that are going to do something close to a bond note or a treasury note or bond future. I saw a couple here. Let’s take a look at. It’s calle d Bond, BOND. There you go so there’s the PIMCO Active Bond ETF. So you just got to pick which one you’re going to trade. I would pick the ones that just got the most volume or a very high volume. I like the TBT and the TLT. Those seem to be pretty. They’ll copy a lot of bonds are doing. The same thing when you do an ETF. If you do the QQQs that’s an ETF of the index Nasdaq. If you do the DIA that’s Diamond. If you do the SPY that’s the S&P 500. And then you’re just going to have to figure out which one you like to trade the best over there. But to my knowledge there’s not one that does it correctly on a 30-year. I could be wrong though because I trade way more futures than I trade ETFs. But there TLT. TBT is listed somewhere out there. And these are in millions so total assets under million. So $86 million AGG. It will probably do good. Let’s take a look at AGG. Yeah. Kind of look like bonds. If you compare that chart to that chart they look similar or that chart. That’s not perfect. I hope that answers your question. So there’s AGG. If you compare that to TY and to US it’s close. It’s not just perfect. The AGG. But that’s kind of how it’s going to work. No ETFs are always going to be perfect correlation to the market because they’re doing like an aggregation type of thing. Trade Thirsty is hosing a multi speaker event called Toast to Traders this weekend Saturday, February 20th at 9AM EST Here are your speakers Steven Brooks, Mark Helweg, Troy Noonan and Dan Passarelli. If you would like to attend this webinar then scroll down look at the topics and of their subjects they’re going to cover under their topics and then the times they are speaking. Good luck. Hope it helps. See you on the next video. Hubert.