If you own a bond fund, you’re likely losing money. Perhaps a lot of money.
As interest rates rise, the value of bonds fall. Since hitting a peak in July, the 20 year Treasury Bond Fund TLT is down 17%. This is a surprise to many investors because they consider bonds to be “safe”.
If the Trump stock market rally continues, watch for bonds to fall further. A key support level for TLT is 112. If TLT falls below that level it is likely to mimic the declines of 2013, possibly declining another 15-20%.
Be cautious, bond funds are NOT SAFE!
——————————————————————————
Listen to the Wealthsteading Podcast to receive updated market commentary:
The 10 Wealth Building Principles can be heard at:
http://www.wealthsteading.com/category/wealth-building-principle/
Subscribe to the Wealthsteading Podcast:
via iTunes: https://itunes.apple.com/us/podcast/wealthsteading-podcast/id896417058
Building Wealth, Investing, Retirement, Stock Trading, Money, Freedom
——————————————————————————