Submitted by Raul Elizalde on Wed, 08/20/2014 - 9:00am
Don’t rush to get rid of bonds yet. Rising interest rates, which harm bond prices, are not in the offing. Despite good news on jobless figures, the Federal Reserve’s concerns about wages may keep rates low for longer than markets expect.
Submitted by Roger Wohlner on Fri, 08/01/2014 - 3:00pm
Alternative investments are all the rage these days. Think through all the details, though, before deciding if they fit your financial plans.
Mutual fund companies fall all over themselves to sell financial advisors and their clients on “liquid alts” easily bought or sold or on hedge fund-like strategies with the daily liquidity offered in a mutual fund wrapper.
Submitted by Jared Kizer on Mon, 07/28/2014 - 9:00am
No investment can perfectly hedge inflation, but placing some protection against inflation in your portfolio is still possible. Your best bets are short-term Treasury Inflation Protected Securities and commodities.
When evaluating whether an asset class effectively protects against inflation, we examine the correlation between the returns and inflation. The stronger the correlation is, the better inflation protection the asset provides.
Submitted by Roger Wohlner on Wed, 07/16/2014 - 9:00am
Are you a retiree with most of your retirement investments in stocks? Good idea? No: Even as the markets near or notch records every day, stay conscious of risks of not diversifying between classes of assets.
A recent Wall Street Journalarticle discussed how retirement savers are putting more money into stocks. Two excerpts:
Submitted by Nicholas Atkeso... on Thu, 07/10/2014 - 9:00am
So baby boomers, heading into retirement and leery of risk, will unload their stocks – and deflate the equities market for a long time, right? Don’t bet on that. For reasons ranging from low bond yields to estate planning, they’ll likely stick with stocks, especially those paying nice dividends.
Submitted by Lewis J. Walker on Mon, 07/07/2014 - 9:00am
Interest rates, against all predictions, are still low. Given the dynamics of U.S. and international economics, they likely will stay that way for a while. Here’s why.
When the fixed-income benchmark yield on 10-year Treasury notes jumped to 3% at the end of 2013, forecasters postulated that interest rates would continue to rise. Since bond values move inversely to bond yields, conventional wisdom indicated an exit from bonds and bond funds.
Submitted by Gary Brooks on Tue, 07/01/2014 - 9:00am
If your portfolio depends heavily on bonds, you may be on an investing path to financial shortfall in retirement. Here’s what you can do about that.
Bond returns over the next 30 years will probably come in substantially less than such returns over the past 30 years. Given changes in the direction of interest rates and current yields at historical lows, bonds face a strong headwind to generate much return – even in a nominal, non-inflation-adjusted sense. Bonds may actually show net negative returns, depending on interest rates and inflation.
Submitted by Brenda P. Wenning on Mon, 06/30/2014 - 9:00am
Easy money policy has its share of side effects. The stock market continues to hit new highs, thanks to the Federal Reserve. But the level of risk that investors and taxpayers are exposed to also may be close to new highs.