Rising Rates: The Great Pumpkin

In late 2013, the 10-year US Treasury yield hit 3%, spooking investors who thought the bond bubble was bursting. Prognosticators urged investors to abandon bonds. And then—they waited.

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The Core of the Modern Bond Strategy: Go Global

“Keep Calm and Carry On” reads a popular World War II–era British motivational poster. We think the first half of the slogan is good advice for bond investors in today’s uncertain markets, but we’d substitute the second with “Go Global.”

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Five Ways to Keep Out of the Bond Liquidity Trap

Bond investors are used to managing interest-rate risk and credit risk. But the financial crisis should have taught us that there are times when liquidity risk can be just as important to manage. Now is one of those times.

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Is This Bond for You? Less Liquid, Yields Great

Bond investors have historically enhanced their returns by taking on more interest-rate or credit risk. Today, a third opportunity is emerging for investors: the liquidity premium.

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Rising Rates: The Good, the Bad…No Ugly

By Doug Peebles (pictured) and Ivan Rudolph-Shabinsky of AllianceBernstein (NYSE:AB) The US Fed has said it will almost certainly boost short-term interest rates by 2015, and many bond investors are focused intently on managing the risks of rising rates. But it’s also important to recognize that there are benefits.

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Bond History: Rhyming, Not Repeating

When the Fed does eventually start raising interest rates, at AllianceBernstein we don’t expect to see bonds experiencing the dire scenarios of 1981 or 1994. Instead, the 2003–2006 period of slow and measured rate normalization seems more likely. But it’s not a perfect match, and we do see some important investment factors to consider.

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Back to the Future: What Time Is It for Bonds?

Investors often ask us how they should think about bond markets in a time of rising yields. Are we facing a situation similar to 1994? Or worse, could it be like 1981, when five-year US Treasury yields soared to 15%? Our answer often surprises them: we don’t think it’s either.

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Seven Lessons Every Fixed-Income Investor Should Learn from 2013

After more than two decades of a fixed-income bull market, 2013 was not a great year for the bond market. Rates bottomed out, many mutual funds had negative returns and bond mutual funds experienced a record $80 billion in redemptions as investors hit the panic button. But it would be foolhardy to assume that 2014 [...]

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The Fed Did Nothing—but Bond Investors Can Act Now

The US Federal Reserve surprised the market on September 18 when it announced that it wouldn’t “taper” its monthly US$85 billion asset purchase program until the economy strengthens. Many investors saw this as a reprieve. We see it as a chance to position bond portfolios for rising rates.

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To Manage Rising Rates, Consider Benching Your Benchmark

Doug Peebles (pictured) and Michael Mon As we enter a period of rising rates, many bond investors are growing more aware of the risks of benchmark-oriented bond portfolios. It may be time to sit the benchmark down and consider more flexible, unconstrained approaches to fixed income.

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