This educational report by Louise Yamada Technical Research Advisors examines the 200-plus year history of U.S. interest rate cycles to warn of an impending market shift. The analysis suggests that the nearly 30-year structural bond bull market, which was defined by falling rates and rising bond prices, is transitioning into a structural bond bear market characterized by rising rates. Because bond prices fall as interest rates rise, the report cautions against traditional long-term “buy and hold” bond strategies in this new environment. To preserve capital during a rising rate cycle, the research recommends using any temporary drops in yields to lighten long bond positions and shift toward shorter durations.
For full report – Special Educational Series: Preparing for a Structural Rising Interest Rate Cycle