
A shockwave is shaking up the investment world, and you won’t believe what’s trending.
This year, short-term U.S. government bonds have become the “it-girl” of investment, with international big-shots racing to get a piece of the action.
Why? Brace yourself…
The Federal Reserve, in a jaw-dropping move, decided to play tough by cranking up interest rates and dropping some major hawkish vibes.
The result?
One-year Treasury note yields shot up, surpassing 10-year bonds by an entire percentage point.
And, yes, that’s as big of a deal as it sounds.
Need some jaw-dropping numbers?
Morningstar has got the tea.
Short and medium-term U.S. Treasury bond funds are raking in a whopping $29.3 billion (that’s up by 70.3% from last year).
Meanwhile, long-term bonds?
Not so hot, with an 11.5% decline in inflows.
Our insider, Adam Coons from Winthrop Capital Management, just spilled that 2-year Treasuries are sitting pretty with a yield of over 5%.
Haven’t seen that glow-up in two decades.
Plus, those bonds are leaving the S&P 500 in the dust, out-yielding it by a staggering 3.5%.
Yet, like in any blockbuster, there are plot twists.
While the short-term bond craze is stealing the limelight, long-term bonds have a secret squad defending their honor.
Telemus’ Matt Dmytryszyn reveals owning these bonds can be your shield in a shaky economy.
But will they regain their superstar status?
However, with the Fed hinting at even more potential rate hikes, it looks like the scales are tipping in favor of those sparkly short-term bonds.
And investors?
They’re playing it smart.
Winthrop’s Coons revealed a genius strategy, betting big on both higher-yielding short-term bonds AND long-duration ones to maximize profits and hedge risks.
So, to all our savvy investors out there: the game is changing.
Will you ride this wild wave of short-term bond mania?