Bond Market Declines: It’s Not Unusual

January 31, 2017 · Written by , ,

The second half of 2016 was a reminder that bonds can and do lose money. In fact, bonds have lost value in 16 of the last 89 years — about 18% of the time, or every five or six years on average.

Accordingly, investors should treat occasional bond market losses as a normal and expected part of investing. Within a properly diversified portfolio, bond losses are often offset by gains in equities. On the flipside, bonds often gain in value when the equity market declines.

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PAST PERFORMANCE DOES NOT PREDICT FUTURE RESULTS

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