TBT 2x Short
ProShares UltraShort 20+ Year Treasury
Shorts: Long Treasuries (TLT)
Expense Ratio
0.90%
Leverage
2x Inverse
Issuer
ProShares
Inception
May 2008
TBT ETF Fact Check
| What it is | TBT is ProShares UltraShort 20+ Year Treasury, an inverse ETF tied to Long Treasuries (TLT). |
|---|---|
| Daily target | 2x Inverse exposure before fees, expenses, tracking error, and daily compounding effects. |
| Cost check | Expense ratio shown here: 0.90%. Verify the latest fee, holdings, and prospectus on the issuer page before trading. |
| Holding-period check | Leveraged inverse ETFs are designed around daily objectives; multi-day returns can diverge sharply from the simple inverse multiple. |
Source checks: ProShares ETF pages for current fund documents and the SEC/FINRA leveraged and inverse ETF bulletin for daily reset risk. Inception shown here: May 2008.
High Risk Leveraged Product
TBT is a 2x leveraged inverse ETF designed for short-term trading only. Daily rebalancing causes significant decay over time. NOT suitable for buy-and-hold investors.
What TBT Shorts
The ProShares UltraShort 20+ Year Treasury ETF (TBT) provides -2x the daily return of the ICE U.S. Treasury 20+ Year Bond Index. This index tracks long-dated U.S. Treasury bonds.
TBT uses derivatives like swaps and futures to achieve its inverse leveraged exposure. It is designed for short-term trading and resets its leverage daily, which causes compounding effects over longer periods.
Key Risks
- Leverage Risk: Daily compounding can cause returns to diverge significantly from 2x the index's return over periods longer than one day.
- Interest Rate Risk: If long-term Treasury prices rise (yields fall), TBT will lose value.
- Counterparty Risk: Exposure to derivatives contracts introduces risk if a swap dealer defaults.
- High Expense Ratio: The 0.90% fee is high for an ETF and erodes returns.
- Extreme Volatility: Designed for short-term use; holding during volatile markets can lead to steep, unexpected losses.
Best Use Cases
- Short-term speculation on rising long-term interest rates.
- Hedging a portfolio against losses in long-term Treasury bond holdings.
- Tactical, high-conviction bet against the price of bonds like TLT for a single day or a few days.
- Sophisticated investors seeking amplified inverse exposure to long-term U.S. government debt.