Investors Duck for Cover Under Treasury Bond ETFs | ETF Trends

Market volatility has investors running for cover in safe havens, and treasury exchange traded funds (ETFs) are no exception.

Equities came crashing down on Wednesday in the wake of the Federal Reserve’s bailout of insurer American International Group (AIG) and strict new short-selling rules from the Securities and Exchange Commission (SEC), reports Carl Gutierrez for Forbes.

The rules are designed to stop “naked” short-selling, which involves borrowing and selling what you don’t actually own. In a typical short sale, investors actually borrow shares before they sell them.

The new rules could help drive up interest in ETFs, which allow investors to conveniently and easily short entire segments of the markets, reports John Spence for MarketWatch. ETFs use derivatives and other instruments to deliver short exposure.

The predominate sentiment in the markets right now is fear, but we caution people not to panic. If you have a strategy in place, it will protect you in times like these.