- That this has happened should be of zero surprise given the rise in the 10-year Treasury yield from 1.70% to 2.40%, and the cyclical nature of investor attitudes.
- Markit takes note of the wave of short-selling in fixed-income ETFs on both sides of the Atlantic, with total demand to borrow ETFs jumping by one third. Shorts are most active in high yield, emerging market, and other long-dated ETFs.
- The most shorted ETFs are the two big junk bond funds (HYG, JNK), and shorts actually slipped a little in November for HYG, but rose 14% for JNK (hedgers likely make up a sizable number of shorts, one would think). Shorts in the investment-grade LQD fell 56%.
- Shorts in the iShares JPMorgan USD Emerging Market Bond Fund (NYSEARCA:EMB) soared 111%.