Why Bonds Beat Expectations
Although widely viewed as less volatile than stocks, risk remains for fixed-income investors.
By Kate Stalter • Dec. 18, 2019
A calmer investing path. Fixed income can serve to dampen volatility in a portfolio, especially when equity markets show downside volatility. Investors can reasonably expect stocks and bonds to move in different directions, or at least not at the same rates. So far this year, both asset classes are showing gains, although stock returns have outpaced bonds. That’s typical in a year when both are in positive territory. “U.S. bonds did better than expected in 2019 as concerns over weak stock markets, a possible imminent recession and trade war worries led investors to bid up bonds, and lowered yields,” says Andrew Aran, partner at Regency Wealth Management in Ramsey, New Jersey.