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Investors weigh longer-dated duration despite turbulent bond markets
Alliance Bernstein’s Scott DiMaggio argued higher real yields, attractive income, and anchored long term inflation expectations support holding duration in active bond portfolios.
ETF Trends reported that 10-year Treasury yields modestly retreated on the first trading day of October but remained near 24-year highs.
The outlet said investors are also facing routs in ex-U.S. bond markets, while elevated yields on 10- and 30-year Treasuries and turbulence elsewhere are leading some investors to consider moving away from fixed income assets.
ETF Trends quoted Scott DiMaggio of Alliance Bernstein saying higher real yields, attractive income, and broadly anchored long-term inflation expectations strengthen the case for duration in traditional active bond portfolios.
DiMaggio added that high current yields can provide a cushion against price declines, and he suggested that embracing duration in this environment requires a focus on diversification.