Did you know the average return in the 12 months following a plunge in the Consumer Confidence Index, which bottomed in June 2022 at an all-time low, is positive 24.9%?
The bond market is having one of its worst years ever as the Federal Reserve Bank raises interest rates to fight inflation. Interest rates and bond prices move in opposite directions. This offers us an opportunity to buy bonds with yields we have not seen in more than a decade. We changed our bond holdings knowing this interest rate tightening cycle would be coming and were able to avoid much of the losses. In the coming weeks we will be changing our bond holdings again to lock in these higher yields and to provide more protection in our portfolios going forward.