Bonds, bonds and more bonds has been the theme the past few months in the capital markets. If the trend continues through April 2020, a cross promotion with the latest James Bond installment, “No Time to Die,” would be auspicious as the thirst for bonds doesn’t appear to be dying anytime soon.

In particular, Treasury notes have been dominating the list of the top 10 best-performing bond exchange-traded funds (ETFs) YTD. It’s not a surprising development given the way yields in safe haven government debt has been falling, which in turn, causes prices to move higher.

Yields fell again as manufacturing data contracted for a second straight month. The U.S. Institute for Supply Management’s (ISM) purchasing managers index read 47.8%, which represented its lowest reading since June 2009.

The U.S.-China trade war and rising dollar were major factors in the latest index reading, according to some analysts.

“Clearly the trade war and strong dollar continue to weigh on domestic goods producers – the report itself summed it up well stating, “Global trade remains the most significant issue”. Given this, one has to wonder how impactful incrementally lower rates may or may not be,” wrote Jon Hill, an interest-rate strategist at BMO Capital Markets.

Unleveraged funds like the Vanguard Extended Duration Treasury Index Fund ETF Shares (NYSEArca: EDV) topped the best-performing list. EDV seeks to track the performance of an index of extended-duration zero-coupon U.S. Treasury securities.

EDV employs an indexing investment approach designed to track the performance of the Bloomberg Barclays U.S. Treasury STRIPS 20-30 Year Equal Par Bond Index. This index includes zero-coupon U.S. Treasury securities (Treasury STRIPS), which are backed by the full faith and credit of the U.S. government, with maturities ranging from 20 to 30 years. The fund invests by sampling the index. At least 80% of the fund’s assets will be invested in U.S. Treasury securities held in the index.

SymbolETF NameYTD
TMFDirexion Daily 20-Year Treasury Bull 3X61.18%
UBTProShares Ultra 20+ Year Treasury39.55%
ZROZPIMCO 25+ Year Zero Coupon US Treasury Index Fund30.16%
EDVVanguard Ext Duration Treasury ETF27.47%
TYDDirexion Daily 7-10 Year Treasury Bull 3X25.50%
VCLTVanguard Long-Term Corporate Bond ETF22.39%
LKORFlexShares Credit-Scored U.S. Long Corporate Bond Index Fund21.93%
SPLBSPDR Portfolio Long Term Corporate Bond ETF21.69%
IGLBiShares Long-Term Corporate Bond ETF21.41%
UJBProShares Ultra High Yield20.85%

 

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