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Portfolio Discussions

Use select charts from the Guide to the Markets to engage in portfolio discussions.

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Fixed income

Today, fixed income investors face the impact of eventual rising rates yet still need bonds for diversification. Investing across core, core complement and extended fixed income sectors may help generate income, reduce volatility and hedge interest rate risk.

Economic Expansions and Recessions
Rates are near historic lows but eventual increases will present challenges
 
  • Following a 30-year bull market in bonds, interest rates are near all-time lows. After adjusting for inflation, real yields on some fixed income investments are close to zero, which limits income generation.
  • Yields have started to move higher as economic growth has stabilized and the Fed signaled that it will reduce its efforts to keep long-term rates low.
  • Further economic improvement, continued Fed tapering and eventual tightening, as well as the possibility of inflation, could put increased pressure on rates.
Discussion Slides
Interest Rates and Inflation
Correlations and Volatility
Fixed Income Sector Returns

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