President Donald Trump and his administration are pushing for the Federal Reserve to lower rates to near-zero levels. However, traders and investors should understand that the Fed only controls very short-term interest rates, impacting the rate at which banks borrow from each other. The bond market determines long-term rate-setting. Recent movements in U.S. Treasury bond yields and prices could escalate this week, impacting investors more than the Fed’s actions. The U.S. debt buildup, tariffs, and Japan’s rising rates are key factors affecting long-term rates and investments.

For investors looking to profit from rising long-term rates, the Ultrapro Short 20 Year Treasury -3X ETF (TTT) offers an opportunity. Unlike put options on bond ETFs, TTT is a leveraged ETF that moves inversely to the price of 20-30 year U.S. Treasury bonds, profiting when bond prices fall and yields rise. TTT, with $20 million in assets and 14 years in operation, provides a unique investment option for those anticipating rising long-term rates.

TTT’s appeal lies in its ability to replicate the inverse of 20-30 year U.S. Treasury bond price movements, offering potential profits as yields rise. With a Fed decision pending, the ETF’s performance could become particularly interesting. While TTT has relatively low assets and trade volume compared to other ETFs, its tight bid-offer spread makes it a viable option for investors. Tracking TTT and similar ETFs like the Short 20+ Year Treasury -1X ETF (TBF) can provide insights into potential market movements based on long-term Treasury rates.

Investors can monitor the 30-year T-bond rate to track the potential performance of TTT and TBF as long-term rates fluctuate. Taking calculated risks with smaller capital amounts can yield significant returns in a volatile market environment. If long-term rates increase, inverse bond ETFs like TTT and TBF are likely to rise as well, offering investors opportunities for profit. As market conditions evolve, investors must remain vigilant and manage risks effectively to navigate potential changes in both the bond and stock markets.

Read more at Yahoo Finance: This ETF Thrives on Rising Long-Term Rates. Why It’s 1 of the Best Ways to Profit Before Wednesday’s Fed Meeting.