Since the beginning of the conflict in Iran, the 10-year Treasury yield has climbed roughly 50 basis points, as of 5/14/26, and rates could still move higher. For equities, higher interest rates make future earnings and cash flows worth less. However, unlike a bond with fixed interest payments, stocks may grow their earnings and cash flow over time.

ProShares Global Investment Strategist Simeon Hyman explains how the ProShares Equities for Rising Rates ETF targets sectors and stocks that have historically shown strong performance as Treasury yields rise, giving investors a more targeted way to position for a market where higher rates may remain a defining theme. Read more in our EQRR Quick Take: Rising Rates? There’s an ETF for That.

Video Transcript:

Since the start of the Iran conflict, the 10-year Treasury yield has climbed roughly 50 basis points, and rates could still move higher. With inflation running above the Fed’s target and energy prices remaining elevated, it’s not difficult to envision 10-year yields pushing past 5%.

For bonds, higher yields typically mean lower prices. But for equities, the story is more nuanced. Higher interest rates make future earnings and cash flows worth less, but unlike a bond whose interest payments are fixed, stocks may grow their earnings and cash flow over time. That’s why stocks could be a quintessential hedge against both inflation and rising rates. But only some stocks possess characteristics needed to thrive during a period of rising rates.

That’s where EQRR comes in. The ProShares Equities for Rising Rates ETF targets sectors and stocks that have historically shown strong performance as Treasury yields rise, giving investors a more targeted way to position for a market where higher rates may remain a defining theme.