I am somewhat undecided as to whether that would be a smart move or not. The chart says this has potential. However, I would state two cautions: 1: The number of folks who have destroyed themselves thinking the last 2-4 years would be an easy bond short is large. 2: If rates really rose, and rose to anything near traditional levels, most world economies would detonate. Therefore, you would fighting the largest forces on earth.
I *do* think (here's the opinion section) one could see a smallish, shorter termish, profitable trade from TBT. But it would be more in the nature of a trade and not something you leave on and walk away from. Maybe a 2-week-6-week trade. For one thing, TBT (as is TLT, the inverse) are double 2x funds, which means they can suffer from erosion over time, and 2, if the Fed and other world banks saw they were creating various forms of havoc in the financial markets, they would IMHO revert to their ZIRP policies. I do not think it is a particularly *dangerous* trade at all, I *do* think the potential profits outwieght the downside. But IMO you'd have to watch it. I trade TBT & TLT on occasion. They are tricky, but not imposdsibly so. Timing an entry I have found tough.
