Q: Hi, can you provide your current thoughts on Long term US treasuries. TLT is down 2.5% so far today. Thanks
Mike
Mike
5i Research Answer:
Long bonds have the most leverage to interest rates (inverse). With today's very strong US job numbers, investors are reconsidering the timing and magnitude of possible rate cuts. We still think rates have peaked, but they may not fall as soon as investors think. Still, we would consider long bonds 'buyable' perhaps in a staggered fashion, over the next few months. Investors need to understand the risks, here, though: we would see these as volatile investments and not 'fixed income' in the typical sense.