Rising Rates: A Blessing in Disguise for Bond Holders

With the recent increases in interest rates, many investors begin to question their allocations to fixed income. These questions and doubts are not without reason: bond values move in the opposite direction as interest rates, so if rates continue to increase, it is only natural to assume that bond prices will continue to deteriorate. However, there are compelling reasons to invest in bonds even in today’s rising rate environment. History shows that fixed income has rewarded patient investors who weathered bouts of rising rates and declining bond values, providing them with higher portfolio yields, and higher total returns over the long-term.

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2018-12-07T21:00:42+00:00

About the Author:

Steven Saunders is a Director, Portfolio Advisor with Round Table Wealth Management.