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Category: Bonds

When Stocks and Bonds Go Down Together

High on the list of the greatest fears among investors is a scenario in which stocks and bonds go down together. Last week those fears were realized when the S&P 500 (SPY) suffered its worst week since January 2016 while long-term Treasury bonds (TLT) also declined. Source Data: Pension Partners, YCharts This was an unusual […]

Will Yields Break on Through to the Other Side?

Bond yields appear to be at a crossroads. At 2.83%, the 10-Year Treasury yield is now at its highest level in over four years. It is also at the upper end of a downtrend channel that has been in place since the mid-1980s. Source: Pension Partners, Stockcharts.com The question all investors are asking: will yields […]

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2017: The Year in Charts

These are the charts and themes that tell the story of 2017… I. The Year Volatility Died There’s an old saying that goes something like this: “the market has a tendency to move in a fashion that inflicts the most pain on the most participants.” After the election in November 2016, the most prominent market […]

Junk Bond Myths

What are high yield bonds? I don’t mean the textbook definition (corporate bonds with a credit rating below BBB), but how they actually behave in terms of risk and return. In attempting to answer this question, let’s address some common myths surrounding the asset class affectionately known as “junk bonds.” Myth #1: High Yield Bonds […]

The Bond Expectations Bubble

  • Bonds
  • Charlie Bilello

“By any measure, real long-term interest rates are much too low and therefore unsustainable. When they move higher they are likely to move reasonably fast. We are experiencing a bubble, not in stock prices but in bond prices. This is not discounted in the marketplace. The real problem is that when the bond-market bubble collapses, […]

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