Many investors consider bonds as relatively stable investments offering regular income and understand that they are a form of debt used by companies and governments.
If there is one thing that makes bond investors nervous, it’s when interest rates rise. But rising rates aren’t always bad – there are several ways to navigate and benefit from rising rates.
Investors include bonds in their investment portfolios for a range of reasons including income generation, capital preservation, capital appreciation and as a hedge against economic slowdown.
Inflation reflects the changing prices of goods and services, and it has the potential to affect investments, particularly bonds. Since the bond market is large and diverse, it provides many opportunities for investors in all sorts of inflationary environments.