1-Star ETFs Poised to Plunge: iShares Barclays 3-7 Year Treasury Bond?

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, the iShares Barclays 3-7 Year Treasury Bond ETF (NYSEMKT: IEI  )  has received the dreaded one-star ranking.

With that in mind, let's take a closer look at IEI, and see what CAPS investors are saying about the ETF right now.

IEI facts

   

Inception

January 2007 

Total Net Assets

$2.1 billion

Investment Approach

Seeks investment results that correspond generally to the price and yield performance of the Barclays U.S. 3-7 Year Treasury Bond Index. The underlying index measures the performance of public obligations of the U.S. Treasury that have a remaining maturity of greater than or equal to three years and less than seven years.

Expense Ratio

0.15%

1-Year / 3-Year / 5-Year Returns

2.7% / 4.8% / 4.2%

Dividend Yield

0.8%

Alternatives

SPDR Barclays Capital Intermediate Term Treasury 

PIMCO 3-7 U.S. Treasury Index ETF 

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 81% of the 97 members who have rated IEI believe the ETF will underperform the S&P 500 going forward.

Just yesterday, one of those Fools, All-Star TerryHogan, succinctly summed up the IEI bear case for our community:

This thing is yielding 0.8%. And in order to expect capital gains, you need bond yields to go down. While there is still some room to go before we're negative, there's not much. I think bonds will underperform from these yield levels. I don't think interest rates are skyrocketing any time soon, but they really can't go much lower.

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