TLT during inflation

Discussion in 'ETFs' started by esu2, Feb 17, 2010.

  1. esu2


    TLT which is mostly 20+ yr US treas bonds
    has been yielding 4% and hovering around 90.

    If inflation were to hit the US,
    would TLT go down and their yield go up ?
  2. Yes,

    Long term bonds have a negative correlation to inflation. The perception that the future holds higher inflation also has an impact on yields though, so it isn't just the most current cpi number that's taken into account.