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Keeping the Big Picture in Mind For investors who have followed our general guidance to use short- and intermediate-term, high-quality bonds and bond funds, there is a positive side to higher interest rates. Higher interest rates mean the bond returns you expect to earn are higher now than they were previously. For investors with a long investment time horizon, this is a plus. Investors must also keep a total portfolio perspective in mind. While interest rates have increased and some bond investments have experienced negative returns in 2013, the stock market is up with the S&P 500 Index up 12.5 percent through June 20. Because one of the key concepts behind diversification is having investments that move in opposite directions, this yet again shows the benefits of having a welldevised approach to building diversified portfolios.
Copyright 2013, The BAM ALLIANCE. This document and all attachments are provided to you, our client, as a service of BAM Advisor Services, LLC. We hope you will use it to keep abreast of emerging research and investment trends, take advantage of up-to-date advice, and revisit the principles on which your investment advisory practice has been founded. Please be aware that this material is provided solely as background information for Registered Investment Advisor firms and is not approved sales or marketing literature. It should not be distributed to clients without prior approval of BAM. Information regarding references to third-party sites: Referenced third-party sites are not under our control, and we are not responsible for the contents of any linked site or any link contained in a linked site, or any changes or updates to such sites. Any link provided to you is only as a convenience, and the inclusion of any link does not imply our endorsement of the site.