Walking the Risk Tightrope - Title Image

Walking the Risk Tightrope

Fixed-Income Outlook: Current conditions could persist for some time, but with a possible recession approximately two years away, the time for caution is approaching.

February 21, 2018


Fixed Income Outlook video

Adam Bloch and Brian Smedley share insights from the First Quarter Fixed-Income Outlook


Fixed-Income Outlook

First Quarter 2018

Report Summary

Fixed-income markets have been walking a risk tightrope for several quarters. Bonds in most sectors are trading above par, yields are historically low, and spreads are near or below pre-crisis levels. The best that a bond investor can reasonably hope for in this market is to earn the coupon, while principal is at risk from an active Federal Reserve, the looming increase in Treasury supply, geopolitical risk, and any credit deterioration. Current conditions could persist for some time—economic growth is accelerating, monetary policy is not overly restrictive, and optimism is high—but history has shown that with a recession approximately two years away, the time for caution is approaching.

 
 
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This material contains opinions of the author or speaker, but not necessarily those of Guggenheim Partners or its subsidiaries. The opinions contained herein are subject to change without notice. Forward looking statements, estimates, and certain information contained herein are based upon proprietary and non-proprietary research and other sources. Information contained herein has been obtained from sources believed to be reliable, but are not assured as to accuracy. No part of this material may be reproduced or referred to in any form, without express written permission of Guggenheim Partners, LLC. There is neither representation nor warranty as to the current accuracy of, nor liability for, decisions based on such information. Past performance is not indicative of future results.

© 2018 Guggenheim Partners, LLC. All rights reserved. Guggenheim, Guggenheim Partners and Innovative Solutions. Enduring Values. are registered trademarks of Guggenheim Capital, LLC.


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VIDEO

Fixed-Income Outlook 

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© 2020 Guggenheim Partners, LLC. All rights reserved. Guggenheim, Guggenheim Partners and Innovative Solutions. Enduring Values. are registered trademarks of Guggenheim Capital, LLC.