Bond Returns: Don’t Be Jealous, Be Worried | NEWFOUND RESEARCH BLOG
Popular bond ETFs have had spectacular year-to-date returns.
Capital gains in bonds are not the same as capital gains in equities. Rather, current capital gains in bonds come at the cost of lower future returns.
Any further bond rallies will imply falling rates. The danger is that at present levels, and without rates going negative, bonds may not have enough room to run to offset equity losses in the case of a crisis.
ETFs representing core bonds have had a strong year. It almost makes you wonder: why even bother buying stocks?
Read more: Bond Returns: Don’t Be Jealous, Be Worried | NEWFOUND RESEARCH BLOG
Mike Rawson
Mike is the owner of 7 Circles, and a private investor living in London. He has been managing his own money for 40 years, with some success.
