reasury rates have surged to their highest levels in recent years due to a combination of concerns around inflation, oil prices, the national debt, and the Fed. The 10-year Treasury yield is once again above 4.6% and the 30-year has been above 5% for the longest streak since 2007.1 In general, this is positive for long-term investors since higher yields support portfolio goals such as income and stability.
There is a saying that smooth seas do not make skillful sailors. When it comes to investing, at no time has this been more true than during the first half of the year. Investors faced major events including the war in Iran, oil prices pushing inflation to multi-year highs, and questions around artificial intelligence (AI). And yet, markets have climbed to new all-time highs, corporate earnings have grown at a double-digit pace, and many asset classes have performed well. The first six months have been a reminder of the importance of staying invested and maintaining a longer time horizon.
Discover why starting early is often more powerful than saving more. This article uses a side-by-side comparison of two hypothetical savers to illustrate the remarkable impact of compound growth over time.
It has now been more than three-and-a-half years since the bull market began in October 2022. At that time, inflation was rising at its fastest pace in fifty years, the Fed was hiking interest rates, and ChatGPT was still a month away from being released to the public. Since then, the S&P 500 has more than doubled in value and the Bloomberg U.S. Aggregate Bond index has fully recovered.
The ongoing conflict in Iran and rising oil prices have been the primary drivers of stock market swings in recent weeks. Brent crude oil has climbed back above $100 per barrel, raising questions about whether higher energy costs could slow economic growth while also pushing inflation higher.
Review your legacy approach regularly, particularly following significant life events or legislative updates.