Market Insight: Bonds have become attractive - but not risk-free
Bonds with long and short maturities are again offering yields that are respectable. However, if you want to limit risk, you shouldn't just focus on that, says Andrea Cünnen.
Several investment houses, including Lazard Asset Management, have stated that bonds are becoming attractive again due to high yields. The yield on 10-year US Treasury bonds has reached over 5.2%, the highest since 2007, and 10-year German government bonds have reached over 3.6%, the highest since 2009. While high yields make bonds appealing, there is still a risk that bond prices may fall and yields may rise further, particularly if the Iran conflict escalates or inflation increases.
However, some analysts believe that bonds now offer a buffer against potential losses, with high interest coupons and a lower risk of dramatic losses.
Written by urgent.news from Handelsblatt's report — not a translation of it. Machine-written — may contain errors; check the original before relying on it.
