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Volatility and Short-Term Government Bonds: 2 ETFs to Watch on Outsized Volume

Sanghamitra Saha

In the last trading session, U.S. stocks were in the red. Among the top ETFs, investors saw SPY, DIA and QQQ lose by about 1.8%, 1.7% and 2.5%, respectively, on the day. Fears of a fading Trump rally on controversies about the leakage of "highly classified information" to two top Russian officials by Trump has unnerved investors.

Two more specialized ETFs are worth noting as both saw trading volume that was far outside of normal. In fact, both these funds experienced volume levels that were more than double their average for the most recent trading session. This could make these ETFs the ones to watch out for in the days ahead to see if this trend of extra-interest continues:

BIL: Volume 3.80 times average

This short-term U.S. Treasury bond ETF was in the spotlight yesterday as nearly 2.8 million shares moved hands compared with an average of roughly 750,000 shares a day. We also saw some price movement as BIL gained nearly about 0.02% last session.

The movement can largely be credited to some weaker-than-expected economic readings and growing uncertainty over Trump trade, which boosted the safe-haven rally. BIL was up about 0.02% in the last one month.

VXX: Volume 3.25 times average

This volatility ETF was under the microscope yesterday as more than 168 million shares moved hands. This compares with an average trading day of around 52 million shares and came as VXX gained about 18.4% in the session. VXX, however, lost about 6.5% in the same timeframe.

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