Investors are well trained to worry about stock market crashes. But what if the next big risk lurking on the horizon is in bonds?
Wall Street firms and many well-known market strategists are sounding alarms about these seemingly benign — even boring — investments. A 30-year bull market in bonds, which drove prices sky-high as interest rates plunged, is ending, they say.
Comments
when the federal reserve stops propping up the market reality will set in........watch your money.
You cherry picked a bit in your article: late 70s was devastating to bonds as well. You only need to look at the math of how bonds work and are priced to realize that when interest rates go back to historic norms, bonds are going to be whacked on their market value. And it doesn't matter what interest rate the bond is paying, repricing on market rates are going to crush these portfolios.