Hello, I am looking for an investment that would rise in a rising interest rate environment. I came up with RYJUX. However, I do not understand what it is that they invest in, or what the trading strategy is. Checking with Etrade data I see that 70% of the funds asssets are in cash and almost 25% invested in FHLBA (don't even know what that is?)....

How can a fund clain to have an inverse relationship to Government bonds when 70% of their funds are in cash? I don't get it.....

I understand why they have a lousy 10 year recoed, that's mostly because we have been in a decling interest rate environment for the last decade. That should have no bearing on the future performance if they truly have an inverse strategy. When bond yeilds eventually start rising, what will they do with the cash they have on the sidelines???

I am looking to invest for a long term period, maybe 3 years, so I have no interest in ETf's which are for daytraders, and often will lose money if held long term, even if the underlying moves in the correct direction, due to the leverage and the daily resets...OIL ETF's are a great example of this, and there are plenty of lawsuits going on right now from investors who did not understand how ETF's work...

But, back to my initial question, how does Rydex operate, and why so much cash on hand, and why no Morning Star ratings?

Thanks to anyone who can help me out!