Your Money
“Bonds stink right now,” Barron’s Jack Hough said on a recent Streetwise podcast, “but you still need them.” Bond yields are near all-time lows, and there is a real risk to prices from rising interest rates. So what's an investor to do?
At PRESERVE, we break down bonds into two categories: short-term reserves for near-term spending and longer-term strategic investments for income and risk-risk reduction. We consider that near-term spending money sacred and optimize as best we can for short-term liquidity.
With those longer-term strategic bond investments, however, we are replacing the traditional with flexibility and alternatives. For qualifying clients, alternatives could include private debt, structured credit, and real estate income. Many private strategies have a built-in way to protect against higher rates from inflation: adjustable, not fixed, interest rates.
Bonds ‘Stink.’ Do They Still Have a Place in Client Portfolios?
by Andrew Welsch and Ross Snel
|