TLT Flushed vs. USO -- Dip to Buy, or Different? The iShares 20+ Year Treasury Bond ETF (TLT) has dropped to a 10-year low vs. the United States Oil Fund LP (USO). Will the TLT/USO total return spread be higher or lower into year-end? The stock market may be a key determinant. Bonds have an upper hand, if history is a guide. TLT's relative discount is a primary factor, and our graphic highlights a potential reversion catalyst: spiking crude oil pressuring equity prices. Dips in TLT/USO in 2008 and 2018 proved to be opportunities to buy US Treasury bonds and sell crude, notably after the S&P 500 dropped below its 100-week moving average. At about a 10% premium to its mean on April 10, the scope for beta reversion on the back of spiking crude, along with oil’s tendency to weigh on the economy, tilts my year-end performance bias toward TLT over USO. Full report on the Bloomberg here: https://blinks.bloomberg.com/news/stories/td66qfkgzakp {BI COMD} #bonds #crudeoil #stockmarket #ETFs @BBGIntelligence(Mike McGlone)