Jamie Dimon’s bearish treasuries bond call has been hot trade in 2026
CHICAGO – MARCH 28: Traders in Ten-Year Treasury Bill options at the Chicago Board of Trade signal a flurry of activity in bids after the Federal Open Market Committee announced it would raise short-term interest rates by another 0.25 percent on March 28, 2006 in Chicago, Illinois. In the moments before the announcement, trading at the mine was slowly resuming. This increase was the Fed’s 15th in a row and the first since Ben Bernanke took over as FOMC chairman.
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Investors concerned about the stock market and looking for ways to prepare their portfolios for a potential stock crash often turn to the U.S. Treasury bond market as a “flight to safety” allocation. But if you’ve been following JPMorgan CEO Jamie Dimon’s dual stock and bond market warning this week, you’d better stay short on treasury exposure.
In fact, that’s exactly what many investors were already doing last year and continuing to do in June and July. U.S. ETF market as investors continue to add record sums to stock ETFs Asset size exceeded 1 trillion dollars mid-year and equity ETFs took up nearly half of that total; many investors have made their own calls to stay on the short end of the treasury market.
ETF flow data over the past year shows investors flocking to short-term treasury funds. iShares 0-3 Month Treasury Bond ETF (SGOV) has been receiving more money from investors this year than any other bond ETF. The ETF generated $47.5 billion in net inflows from investors, according to ETFAction.com. It has become the third-largest bond ETF overall, with assets of close to $100 billion. Vanguard Total Bond Market ETF (BND) and iShares Core US Total Bond ETF (AGG).
In an interview with CNBC Contributor Wilfred Frost on Monday, Dimon said he would not buy long-term treasuries as well as stocks that are trading at values he would not touch. “A 10-year bond should probably be in the 4% to 4.5% range,” he said.
Even as inflation begins to approach the Federal Reserve’s 2 percent target, the CEO of the nation’s largest bank says he doesn’t see much of a rise in long-term government bond prices.
The 10-year treasury currently yields 4.6 percent, and the yield has been rising for much of the year as the market has shifted from the view that the Fed will eventually cut rates to the view that it will cut interest rates. a raise may be more likely. As long as the risk of interest rate hikes continues and the inflation outlook remains uncertain, 10-year treasury prices, which move inversely to yields, are expected to remain under pressure. Broader concerns about government spending and deficit levels are also contributing to concerns about yields.
Last year, Vanguard Total Bond Market and iShares 0-3 Month Treasury Bond ETF were the only fixed income ETFs among the top 10 ETFs in terms of flows, according to ETFAction data. The iShares short-term treasury fund ranks 5th overall with a net inflow of approximately $50 billion. This figure is surpassed only by the largest ETFs (Vanguard, iShares and State Street core S&P 500 funds and Vanguard Total Stock Market ETF).
The momentum for short-term Treasuries continued throughout the year, with SGOV ranking 5th among all ETFs in June flows.
The idea that short-term treasuries have room to cushion market volatility is not new and has been most widely promoted by Warren Buffett. 2013 annual letter He told Berkshire Hathaway investors that his estate plan for his wife was 90% S&P 500 and 10% short-term Treasuries, which was probably good enough for most long-term investors.
