Also many cash-rich private investors have also been buying short-dated gilts for the tax benefits. We explained why and how in a member post in November.
So why the disconnect?
Once bitten by bonds
I believe that many thoughtful and engaged passive investors were a bit blindsided by the bond rout as interest rates soared a few years ago.
These investors had commendably educated themselves about the benefits of a diversified portfolio.
But they’d taken away an over-simplified mantra that ‘bonds are safe’, and skipped the small print.
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