What TTT Shorts

The ProShares UltraPro Short 20+ Year Treasury (TTT) is designed to deliver three times the inverse (-3x) of the daily performance of the ICE U.S. Treasury 20+ Year Bond Index. This index tracks long-dated U.S. Treasury bonds.

It uses financial derivatives like swaps and futures to achieve its leveraged inverse exposure. The fund resets its leverage daily, meaning returns over periods longer than one day will deviate from three times the inverse of the index's return due to compounding.

Key Risks

• Compounding Risk: Daily reset of leverage causes returns over longer periods to diverge significantly from 3x the inverse of the underlying index's return.
• Interest Rate Risk: TTT loses value when long-term Treasury prices rise (yields fall). It is designed to profit primarily when long-term interest rates rise.
• High Volatility & Loss Risk: The 3x leverage magnifies losses as well as gains, leading to extreme price swings and potential for rapid depletion of capital.
• Counterparty Risk: Relies on derivatives contracts with other financial institutions, which could lead to losses if those counterparties fail.
• High Expense Ratio (0.95%): The cost of the fund's complex strategy is high and erodes returns over time.

Best Use Cases

• Short-Term Hedging: Sophisticated investors looking to hedge a portfolio against a sharp, near-term rise in long-term interest rates.
• Tactical Bearish Bet: A high-conviction, short-term speculative position that long-term Treasury bond prices will fall.
• Volatility Management: Used as a tactical tool within a broader trading strategy to capitalize on expected increases in bond market volatility.
• Institutional Strategies: Component in complex institutional strategies, such as pairs trades or as a hedge for mortgage-backed securities portfolios.

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Frequently Asked Questions