Dangers Lurking In The Bond Market

From The Blog of HORAN Capital Advisors
February 10, 2013 - 12:17am

The secular decline in interest rates since 1981 has resulted in bond investors enjoying a thirty year bull market run in most fixed income investments. Since the price of a bond moves inversely to the move in interest rates, the declining rate (and rising bond price) environment is the only investment environment experienced by many baby boomers during their peak investing years. This declining rate period can best be shown by the long term chart of the yield on the 10-year treasury bond.From The Blog of HORAN Capital AdvisorsConversely, the retiring baby boom generation has enjoy a less than smooth ride in the equity markets, punctuated by the technology bubble, the financial crisis in 2008/2009 and the bursting of the housing bubble. The risk in equities seem to have far out weighed the return or lack thereof.In a few recent posts on this blog, we note investors continued to pour inve...

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