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Why Stay Invested – In Bonds

You may have noticed that the Bloomberg Aggregate Bond Index is off to one of it’s worst starts of any year in the history of the index. Although bonds have been universally accepted as an essential element of investment portfolios for the balance they provide to owning stocks, their performance this year has left many wondering why they should continue to own bonds.

Just as many things look worse when you look at them under a microscope, so can investments. Investors should take a step back and understand that judging your bond allocation on such a short period can result in making poor decisions. There are reasons to believe there are bright spots on the bond horizon. The reduction in bond prices has created more opportunities in that segment of the market. Higher rates mean more income and better expected returns. Bonds still provide diversification to portfolios.

The current environment also highlights the benefits of incorporating alternative investments in a portfolio and the value that active management can add to a portfolio. So before you decide to make any big changes to your portfolio, hold your nose and give it a little time.

Content in this material is for general information only and not intended to provide specific advice.

All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.

All investing involves risk including the loss of principal. No strategy assure success or protects against loss.

About LPL Financial
LPL Financial (Nasdaq: LPLA) was founded on the principle that the firm should work for the advisor, and not the other way around. Today, LPL is a leader in the markets we serve,* supporting nearly 20,000 financial advisors, and approximately 800 institution based investment programs and 500 independent RIA firms nationwide. We are steadfast in our commitment to the advisor-centered model and the belief that Americans deserve access to personalized guidance from a financial advisor. At LPL, independence means that advisors have the freedom they deserve to choose the business model, services, and technology resources that allow them to run their perfect practice. And they have the freedom to manage their client relationships, because they know their clients best. Simply put, we take care of our advisors, so they can take care of their clients

*Top RIA custodian (Cerulli Associates, 2020 U.S. RIA Marketplace Report); No. 1 Independent Broker-Dealer in the U.S (Based on total revenues, Financial Planning magazine 1996-2021); No. 1 provider of third-party brokerage services to banks and credit unions (2020-2021 Kehrer Bielan Research & Consulting Annual TPM Report); Fortune 400 Company as of June 2021. LPL and its affiliated companies provide financial services only from the United States.

Jones & Company and LPL Financial are separate companies.

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