After a decade of near-zero rates, a diversified bond fund now yields roughly 4.5%. That is enough to cover inflation in most forecasts and to cushion a stock-heavy portfolio when equities stumble.
The risks to weigh
Shorter-duration funds fall less when rates rise but give up some income. Many investors split the difference with a ladder of maturities, or hold a broad fund and rebalance once a year.
None of this is a forecast, and past performance does not predict future results. Fees, taxes and time horizon matter at least as much as the product itself, and a plan you can stick with through a bad year usually beats a clever one you abandon.
With ten-year yields above 4%, bonds once again offer meaningful income, but duration risk has not gone away.
A sensible next step
This article is for information only and is not investment advice. Figures are illustrative and may be delayed or simulated for demonstration purposes.
This article is for information only and is not investment advice.
