January 31, 2014
In a recent Dallas Morning News article, Baird Chief Investment Officer Mary Ellen Stanek says that mature investors are smart to be cautious about bonds in this rising interest rate environment, but shouldn’t avoid them.
“While it may make sense for some seniors to increase their allocation to other sectors and reduce their allocation to bonds, we would caution against abandoning bond allocations all together,” said Mary Ellen Stanek, director of asset management at Baird, a wealth management firm. (excerpt)
For more information, please read the article.
All investments carry a degree of risk. There are many material differences between bonds and equities, which must be weighed carefully before investing. In a rising interest rate environment, the value of fixed-income securities generally declines and conversely, in a falling interest rate environment, the value of fixed-income securities generally increases. High yield or high dividend securities may be subject to market, interest rate or credit risk and should not be purchased solely because of the stated yield or dividend rate.
Diversification and dollar cost averaging do not ensure a profit, nor do they guarantee against loss is declining markets. Investors should consider their ability to maintain the periodic investments required by dollar cost averaging.
Please consider the investment objectives, risks, charges and expenses of a fund carefully before investing. This and other information is found in the prospectus and summary prospectus. For a prospectus or summary prospectus, contact your financial advisor. Please read the prospectus or summary prospectus carefully before investing.