fixed income returns during rising interest rates

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Always passive
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Joined: Fri Apr 14, 2017 4:25 am
Location: Israel

fixed income returns during rising interest rates

Post by Always passive »

Good article on bond behavior during past interest raising. It does not look that bad,
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https://finance.yahoo.com/news/fixed-in ... 00142.html
Robot Monster
Posts: 2518
Joined: Sun May 05, 2019 11:23 am
Location: New York

Re: fixed income returns during rising interest rates

Post by Robot Monster »

I notice that, from Jan 1976 - Dec 1981, cash and a 46/64 portfolio (US stocks and intermediate Treasury) yielded the same inflation adjusted CAGR of 0.07%. Bonds did worse than cash, and stocks did better. It's funny, because these days cash is considered the very lowest ring of the ladder, or below that: nothing more than trash. If inflation heated up enough to make the Fed act, that could change. Not expecting this.

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