Risks in the US bond market

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SPONSORED | PSGWealth US bond yields are at 40-year lows, and still investors fall over their feet to snap up more US Treasuries. Read more.

21 August 2020 - 13:34US bond yields are at 40-year lows, and still investors fall over their feet to snap up more US Treasuries.

It could be that since July 2018, 30-year Treasuries have handsomely outperformed both Amazon shares and the gold price index, returning almost 60%. In fact, these bonds have become so popular that even the two-year yields are now threatening to turn negative - meaning you will pay interest on your investment and not earn interest.

As the US Federal Reserve embarked on more monetary support, the yield curve has become even lower and flatter. Negative real yields across the curve are now a real possibility, while all data points to yields threatening to turn negative on the shorter end of the curve.

 

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