FYI: Because bond yields remain low relative to the experience of the previous half-century and because the yield spread between short- and long-term bonds is close to zero and even slightly negative or “inverted” in spots, many investors’ natural inclination is to hold a bond portfolio with a very short average maturity. Why commit to longer maturities when you are not rewarded for doing so in the form of higher yields and it appears unlikely that interest rates can fall much lower than they already are? While I don’t think that following this “common sense” inclination would be a huge mistake, that’s not what I’m doing in my own portfolio. Here’s why
Regards,
Ted
https://www.advisorperspectives.com/articles/2019/04/10/why-investors-should-not-shorten-bond-maturities
