Worried about rising interest rates?
The Claymore Inverse 10-Year Government Bond ETF is one way to capitalize on this concern. This latest offering from Claymore Investments Inc. aims to replicate the opposite of the daily total return before fees of the 10-Year Government of Canada Bond.
This unleveraged ETF "is a tool for investors who are looking to hedge against potential effects of rising interest rates without necessarily having to sell their current bond investments," says Claymore chief executive officer Som Seif.
Claymore says its ETF is not intended as a foray into the leveraged and inverse ETF space dominated by Horizons BetaPro Management Inc., which offers the leveraged HBP U.S. 30-Year Bond Bear Plus ETF .
For Claymore, the 10-Year Government of Canada Bond refers only to bonds issued by the Canadian government. Bonds of crown corporations as well as provincial and municipal bonds are not included. It includes semi-annual pay, fixed-rate bonds denominated in Canadian dollars originally issued at 10-year auctions with an effective term to maturity of 8 to 10.5 years, a credit rating of at least BBB and a minimum issue size of $3.5-billion. See the prospectus.