It has been a rough few weeks for bond investors. With more uncertainty to come, it might be time to look at some hedging options. This was supposed to be the time when long-suffering fixed-income investors finally earned their reward. After forcing bondholders to endure months of "higher-for-longer," the Federal Reserve finally cut interest rates last month. While short-term rates have declined, investors have sold off longer-dated bonds, sending yields on the 10-year Treasuries to 4.
Even more dramatic has been the wild ride of iShares 20+ Year Treasury Bond ETF. The fund made headlines when it rallied nearly 8% in the weeks before the Fed lowered rates in mid-September. Since then, it's given back all those gains and more, having tumbled 9% since its Sept. 16 high. MORE ON ETF NEWS: FOXBUSINESS.COM One reason for the recent surge in yields may be that investors' attention has shifted to the presidential election.
Either way, the coming week could be critical for bonds. Even before Election Day on Nov.