Why not short Treasury bonds? (MoneyWatch) For the past several years, investors have been worried that interest rates were sure to rise, leading them to stay away from investing in any bonds except very short-term ones. That has been bad enough, but some investors have even sought out funds that short Treasuries, hoping to cash in once rates go up. That strategy has been even worse. Let's look at a few of the larger of these funds to see how investors have been rewarded for betting against bonds. We'll begin with the ProShares Short 20+ Year Treasury ETF (TBF), with assets of about $950 million. In 2010, 2011 and 2012, the fund returned -12.4 percent, -29.6 percent and -5.7 percent, respectively, producing a cumulative loss of about 42 percent. Through Feb. 15, the fund managed a gain of 3.4 percent in 2013, reducing the cumulative loss to just 40 percent. Investors who were more sure about the forecast of rising rates might have bought the ProShares UltraShort 20+ Year Treasury (TBT), which has $3.6 billion in assets. This fund aims to return twice the inverse of the daily performance of the Barclays U.S. 20+ Year Treasury Bond Index each day. After returning 32.2 percent in 2009, the fund lost 25.7 percent in 2010, lost 51.2 percent in 2011, lost 12.2 percent in 2012, producing a total loss over four years of 58 percent. Through Feb. 15, the fund had returned 6.9 percent in 2013, reducing the cumulative loss to just 55 percent. Our final look is at the Direxion Daily 20+ Yr Treasury Bear 3X Shares ETF (TMV), which has assets of about $330 million. The fund seeks to returns three times the inverse of the NYSE 20 Year Plus Treasury Bond Index each day (before expenses and fees). In 2010 the fund lost 36.7 percent. In 2011 it lost another 68.5 percent. And in 2012 it lost another 20.2 percent. The cumulative three year loss was 84.1 percent. Through Feb. 15, the fund had gained 9.5 percent in 2013, reducing the cumulative loss to just 82.6 percent. As you can see, bad performance doesn't come cheaply. You have to pay dearly for it. The next time you're tempted to make investment decisions based on guesses about interest rates or markets in general, keep these results in mind. Image courtesy of Flickr user Images_of_Money.