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Why bonds have behaved so strangely – and you might want to own them anyway

As interest rates have climbed, interest in fixed income investments has returned – but those who’ve looked at recent returns could have been in for a nasty shock, with negative total returns for several benchmarks.

 

As interest rates have climbed, interest in fixed income investments has returned – but those who’ve looked at recent returns could have been in for a nasty shock, with negative total returns for several benchmarks. So why have bonds performed so poorly, and is the tide turning?

NAB Markets’ Ken Crompton joins the podcast to discuss:

  • the return of yield, and what it offers investors
  • why the world is ‘awash with debt’, offering a range of investment opportunities
  • simple (and complex) explanations for the volatility in bond markets 
  • whether recent moves in rates will help to stabilise prices
  • how US debt issuance is changing markets, and
  • how to incorporate fixed income into your portfolio.

You can access this and previous episodes of the Your Wealth podcast now on iTunesPodbeanSpotify or at nabtrade.com.au/yourwealth

If you’re short on time, consider listening at 1.5-2x speed, which should be shown on the screen of your device as you listen. This won’t just reduce your listening time; it has also been shown to improve knowledge retention.


About the Author
Gemma Dale , nabtrade

Gemma Dale is Director of SMSF and Investor Behaviour at nabtrade. She is the host of the Your Wealth podcast, a fortnightly podcast for investors, featuring insights and updates from markets and finance experts across a range of topics. She provides regular market and finance commentary on ausbiz and in other media including AFR, the Australian, ABC and commercial tv and radio. Gemma was previously the Head of SMSF Solutions for nab, and the Head of Technical Services for MLC, where she led a team of specialists providing advice to advisers and their clients on SMSF, super, tax, social security and aged care.