This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Tread Carefully With New Treasury ETFs

Ameristock, manager of the very successful (AMSTX) fund, is moving further into the exchange-traded fund space.

Earlier this year, Ameristock made headlines by launching the U.S Oil (USO) fund, the first ETF to track the commodity. Now, Ameristock has filed to roll out fixed-income ETFs based on Treasuries with different maturities.

There will be five separate ETFs, with the funds based on Treasuries with one-year, two-year, five-year, 10-year and 20-year maturities. All of the funds are expected to have a 0.15% expense ratio.

Barclays, the bank behind iShares ETFs, offers several bond ETFs. But instead of targeting a specific maturity, the iShares funds -- iShares Lehman 1-3 Year Treasury (SHY), iShares Lehman 7-10 Year Treasury (IEF) and the iShares Lehman 20+ year Treasury Bond (TLT) -- target a range of time.

Ameristock's new bond ETFs will be more of a benefit to people who trade actively, or to institutional managers, who now will have a fast and easy way to more narrowly manage duration, make short-term directional bets on interest rates, and quickly reallocate the makeup of their bond portfolios.

Unfortunately, these funds may not be right for do-it-yourself investors looking for steady income.

According to the Ameristock prospectus , the bonds (or notes) owned in each fund will be from the most recent auction for that maturity -- sort of. Each of the funds will blend together maturities, and possibly futures contracts, to "create" the yield associated with the targeted maturity for each given ETF.

The downside of this strategy is that investors are not locking in what might be a favorable yield.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
IEF $110.00 0.00%
SHY $85.01 0.00%
TLT $129.38 0.00%
USO $11.30 0.00%
AAPL $93.74 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs