How To Make 150% Returns Off Of Higher Interest Rates

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How To Make 150% Returns Off Of Higher Interest Rates


After a year of mostly moving higher, with barely any volatility to speak of, we’re finally seeing a shift in the financial markets. It’s not just stocks – bonds, commodities, and currencies are also moving into new territories.

Of course, much of the change is due to the expected change in interest rates and inflation (which are directly linked). It’s been several years since we’ve had any substantial changes in interest rate expectations. The arrival of higher rates is certainly inducing a sea of change to the financial markets.

Now, not every change to the market is going to be as extreme as the selloff we experienced at the beginning of February. The volatility spike was especially nasty (and probably way overdone). But, sometimes it’s a major event like the early February correction which begins a longer-term trend.

The trend in bond prices hasn’t exactly been subtle either, although it’s not as extreme as the move in stocks and volatility. You can see in the chart below of iShares 20+ Year Treasury ETF (NASDAQ: TLT), that long bonds have been in steady decline since the start of the year.



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