ETF Bond Duration: Negative-Term

An ETF bond duration negative term refers to the inverse of a bond exchange-traded fund (ETF). This type of ETF is designed to provide investors with daily returns that correspond to the opposite performance of a bond index. For example, if a particular bond index loses 1%, then the ETF should gain 1%. Because this type of investment moves inversely to bonds and adjusts every day, it results in low tracking errors and greater efficiency as an alternative to traditional fixed income securities. In essence, it provides investments exposure and stability during times when a bond market could potentially suffer losses. ETFs can be used widely across all investor portfolios for diversification or defensive strategies.