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Negative Duration Bond ETF (AGND) Hits New 52-Week High

ByZacks Investment Research
Published 02/05/2018, 09:50 PM
Updated 07/09/2023, 06:31 AM
BARC
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For investors seeking momentum, WisdomTree Barclays (LON:BARC) U.S. Aggregate Bond Negative Duration Fund AGND is probably on radar now. The fund just hit a 52-week high, and is up 4.2% from its 52-week low price of $42.75/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

AGND in Focus

This fund helps investors maintain traditional bond exposure, while mitigating their overall sensitivity to rising interest rates. It utilizes an Institutional style approach that combines a long position in bonds representative of the Bloomberg Barclays U.S. Aggregate Bond Index with a short position in Treasury securities to target a negative duration. The product charges 28 bps in annual fees from investors (see: all the Total Bond Market ETFs here).

Why the Move?

The negative duration corner of bond investing has been an area to watch lately given the spike in Treasury yields. The 10-year Treasury yields jumped to as much as a four-year high of 2.88% on concerns over inflation. Rising inflation could push the Fed to raise interest rates quicker than anticipated. In such a scenario, negative duration bond ETFs act as a powerful hedge and a money enhancer in a rising rate environment.

More Gains Ahead?

It seems that AGND might remain strong given a weighted alpha of 2.70% and a 20-day volatility of 4.54%. As a result, there is definitely still some promise for investors who want to ride on this surging ETF a little further.

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WISDMTR-B USABN (AGND): ETF Research Reports

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