Investors continue to take money out of equities and buy bonds. The US Treasury 10-year note yields less than 2% yet still attracts new money. Don't people know that these historically-low rates can't last forever?
As Dave Glen, CFP, CFA at Boston Private Bank and Trust writes, "... a tiny 25 basis point rise in interest rates (next year implies a) capital loss of 2% which will negate the coupon income for the entire year."
http://randomglenings.blogspot.com/
This asset re-allocation cannot last much longer. Have hope that this minor correction will be shallow and brief. Wait for bond quality spreads to narrow - and then buy equities like there's no tomorrow!
As Dave Glen, CFP, CFA at Boston Private Bank and Trust writes, "... a tiny 25 basis point rise in interest rates (next year implies a) capital loss of 2% which will negate the coupon income for the entire year."
http://randomglenings.blogspot.com/
This asset re-allocation cannot last much longer. Have hope that this minor correction will be shallow and brief. Wait for bond quality spreads to narrow - and then buy equities like there's no tomorrow!
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