How long will bond holders take disappointing returns?
http://www.thenewstribune.com/2014/06/24/3258663/how-long-will-bond-holders-take.html?sp=/99/261/
How long will bond holders take disappointing returns?
June 24, 2014
Theres an old saying that the stock market can remain irrational longer than investors can remain solvent.
But when it comes to the bond market and dealing with interest rates, solvency isnt the issue.
The bond market can remain irrational longer than investors can remain tolerant, and judging from the conversations at the recent Morningstar Investor Conference in Chicago, investors are running out of patience in this low-yield environment. Thats not entirely a new trend, but it is growing as the rate hikes that most investors expected to see in 2014 have been pushed back and now arent anticipated to arrive by most experts for 12 to 18 months.
Bond fund giant Bill Gross said in Chicago that he believes the bond market will be stuck in the new neutral, but thats not a status that most investors will be willing to ride with for long.