Bonds are essentially loans where investors lend money to a corporation, government or organization. In exchange, the borrower typically agrees to pay the investor a fixed interest rate over a set period of time.
When stock markets tank, investors tend to move their money into bonds since these investments are less risky and can help soften the blow to their portfolios. This is why historically, when equities lose value, bonds would hold their value or even rise in value.
In early April, though, that didn’t happen. Following President Trump’s announcement of sweeping tariffs, stocks and bonds sold off simultaneously. Although markets recovered somewhat after Trump’s 90-day pause on the tariffs, the recent fluctuations have left investors wondering if bonds still deserve a spot in their portfolios.
Should you invest in bonds?
Despite the bumpy start to the year,…
