Are Your Clients Bond Portfolios Ready for Rising Rates?

While the concept of risk management is typically not one embraced by bond investors, especially those who own a large proportion of government and agency securities, we at YieldQuest believe it is imperative for our clients to incorporate risk management into their fixed income portfolio strategies at this time, given what many market commentators have referred to as a potential bubble in Treasury bonds (we agree with this bubble assessment). We believe the generational lows in Treasury yields, despite the recent rise, strongly support our recommendation for investors to focus on the inherent risk embedded in their portfolios on a look-forward basis from holding an un-hedged allocation to Treasuries and other fixed income securities, especially un-hedged bond funds.

Bringing Risk Management to Your Portfolios

(A YieldQuest Commentary)

In light of the generational lows in Treasury yields, traditional buy and hold strategies involving US Treasury securities via holdings in open-end mutual funds not only present little if anything to get excited about at this time, in our view, but may well leave client portfolios at significant risk to rising rates.

The Advantages of Investing in Individual Bonds

(A YieldQuest Commentary)

The generational lows in Treasury yields, we believe, strongly support our recommendation for investors to focus on the inherent risk embedded in their portfolios on a look-forward basis from holding an un-hedged allocation to Treasuries and other fixed income securities, especially unhedged bond funds.