The CAISSA Minute: What Rising Rates Means for Investors
September reminded investors that stocks and bonds can sometimes decline at the same time. As inflation concerns persisted and the Federal Reserve raised interest rates, Treasury yields moved sharply higher. That put pressure on bond prices and stock valuations, even as the broader economy continued to show resilience. So what does this mean for your portfolio?
Video Transcript
Welcome to the CAISSA Minute, where we’re going to spend a minute talking about what rising rates means for investors.
September reminded investors that stocks and bonds can sometimes decline at the same time. As inflation concerns persisted and the Federal Reserve raised interest rates.
Treasury yields moved pretty sharply higher. That put a lot of pressure on bond prices and stock evaluations, even as the broader economy continued to show a lot of resilience. So what does this mean for your portfolio?
First, one difficult month does not define a long-term investment strategy. So, secondly, bonds still have an important role, but their sensitivity to interest rates does deserve some attention. And third, keeping enough liquidity for near -term spending needs, it does reduce the pressure to sell investments during these volatile market times.
So at CAISSA, we’re going to focus on balancing these risks across a diversified portfolio rather than making changes in response to a single month of market performance, and if you want a refresher on the inverse relationship between bonds and interest rates, give us a call. We’d be happy to talk you through it.
Thanks for taking time with CAISSA Minute