Charlie Bilello, the chief market strategist at Creative Planning, highlighted that rising yields have badly beaten down the U.S. bond market, especially ETFs targeting the long-end of the yield curve.



The long-duration bond ETFs like PIMCO 25+ Year Zero Coupon U.S. Treasury Index ETF (NYSE:ZROZ), iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT), Vanguard Long-Term Treasury ETF (NASDAQ:VGLT), and Vanguard Extended Duration Treasury ETF (NYSE:EDV) are among the laggards.  



<h2>High Yields Hurt Bond ETFs</h2>



In Monday's post on X, Bilello said that ZROZ has dropped drastically by over 60% from its peak in March 2020. When bond yields rise, bond prices decline due to their inverse relationship.



&#34;The 30-Year Treasury yield has moved from an all-time low of 0.8% in March 2020 to over 5% today,&#34; leading to the largest drawdowns in history, said Bilello. He described, &#34;Long duration + Rising interest rates = Pain.&#34;



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<blockquote>The longest duration bond ETF is down over 60% from its peak in March 2020. How is that possible? The 30-Year Treasury yield has moved from an all-time low of 0.8% in March 2020 to over 5% today. Long duration + Rising interest rates = Pain Video: https://t.co/bigdjJMJWF pic.twitter.com/Cj47A9zoP7— Charlie Bilello (@charliebilello) May 25, 2026</blockquote>
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The 30-year yields are trading at the highest since July 2007. The 10-year yields rose to 4.51% from an all-time low of 0.32% in March 2020, while 2-year yields climbed to 4.07% from a record low of 0.23%.  



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<h2>ETFs in Focus</h2>



PIMCO 25+ Year Zero Coupon U.S. Treasury Index ETF 



This fund tracks the BofA Merrill Lynch Long Treasury Principal STRIPS Index. It has $1.4 billion in assets under management (AUM) and trades in an average daily volume of 510,000 shares. It charges 0.15% in annual fees. ZROZ has lost 4.5% since the start of the year.



Benzinga Edge Stock Rankings indicate that ZROZ has a weak Momentum score in the 18th percentile. It maintains a weak price trend in the short, medium, and long term.



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iShares 20+ Year Treasury Bond ETF



TLT follows the ICE US Treasury 20+ Year Bond Index and charges 15 bps in annual fees. It is among the most popular and liquid ETFs in the bond space, with AUM of $42.8 billion and an average daily volume of nearly 26 million shares. The ETF is down 2.8% year-to-date and about 44% from its March 2020 peak. 



Benzinga Edge Stock Rankings indicate that TLT has a weak Momentum score in the 20th percentile. It maintains a weak price trend in the short, medium, and long term.



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Vanguard Long-Term Treasury ETF



With an AUM of $10 billion, VGLT tracks the Bloomberg US Long Treasury Bond Index. It has an expense ratio of 0.03% and trades in an average daily volume of nearly 2 million shares. The ETF has shed 3% in value this year so far and about 67% since its March 2020 peak.



Benzinga Edge Stock Rankings indicate that VGLT has a weak Momentum score in the 22nd percentile. It maintains a weak price trend in the short, medium, and long term.



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Vanguard Extended Duration Treasury ETF



EDV follows the Bloomberg U.S. Treasury STRIPS 20–30 Year Equal Par Bond Index. It has an expense ratio of 0.05% and trades in a volume of nearly 2 million shares per day on average. The ETF has $3.6 billion in AUM and has shed 3.7% since the start of the year. EDV is down about 67% since its March 2020 peak.



Benzinga Edge Stock Rankings indicate that EDV has a weak Momentum score in the 19th percentile. It maintains a weak price trend in the short, medium, and long term.



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Bond ETFs Attract Inflows



While rising yields have hurt the performance, the fixed-income ETFs have attracted $156.19 billion in inflows so far this year, ahead of the $98.19 billion recorded during the same period last year. Strong inflows come despite persistent concerns around elevated Treasury yields and the Federal Reserve’s higher-for-longer stance, suggesting investors are positioning for a bond market recovery.



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Photo courtesy: Jason Raff on Shutterstock.com

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Charlie Bilello, chief market strategist at Creative Planning, warns that surging Treasury yields have led to historic drawdowns in long-duration bond ETFs, with some down over 60% since March 2020. The 30-Year Treasury yield has risen from 0.8% to over 5%, negatively impacting bond prices. Despite this, fixed-income ETFs have attracted $156.19 billion in inflows this year, indicating investor positioning for a potential recovery in the bond market.

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Vanguard Long Term Gov

iShares 7-10 Year Treasury Bond ETF

ISHRS Us Trsry Bd

US Treasury 30 Year Bond ETF

Pmco 25+Yr Zero Cpn Us

Schwab Long-Term US Treasury ETF

iShares barclays 20+ Yr Treasury Bd

Invesco Equal Weight 0-30 Year Treasury ETF

VG Extend Trsy

NVIDIA

NVIDIA Corporation

Long-Duration Bond ETFs Face 'Pain' As 30-Year Treasury Yield Tops 5%, Says Charlie Bilello