1ST QUARTER FIXED INCOME
Fixed Income Market: The bond market also was buoyed by a seeming belief that the worst economic news was in the past. The yield on the 10-year U.S. Treasury note – which moves inversely to prices – fell to 3.491% from 3.826% at the end of 2022. It was the biggest rally in Government bond prices since 2020.
Other Assets: Our aversion to long-term bonds remains and is reinforced by the inflationary situation. We like bond maturities under two years which now have higher rate returns than previous years. We like laddering investments with a mix of U.S. Government, municipal, and high- quality corporate bonds. We also like the new better-paying opportunities in money market funds.
Also, for some clients, we look at alternative investments through Broadly Syndicated Loan vehicles and Collateralized Loan Obligations which can provide investors with greater security through collateral, yields, and a hedge against inflation through floating rate structures.