Right now, governments around the world are paying more to borrow money than at any point in decades. Japan is at a 30-year high. The UK is at its highest since the financial crisis. America’s 30-year levels have not been seen since 2007. This is not a technical story for traders. This is about your mortgage, your pension, your savings, and the value of every asset you own.
What should you be doing about it?
“For savers, there are opportunities in fixed-yield returns. If you prefer stocks, find an investment adviser who can recommend a good investment fund that has historically shown good returns in times of turbulence.” – Nigel Green
Markets can feel like a roller coaster. Find a good financial adviser to form a long-term plan for your money. Always stay diversified and talk to an adviser before making investment decisions.
The world’s largest sovereign wealth fund is cutting its holdings of government bonds.
Norway’s sovereign wealth fund, valued at over $2.3 trillion, is reducing the government subindex of its bond holdings from 70% down to 50% to provide sufficient liquidity during current market conditions. This chiefly affects US treasuries. The rebalancing of the portfolio would add other types of non-government US bonds and other assets such as corporate bonds and mortgage-backed securities.
This comes after the US bond sell-off, as investors worry about the high debt load of almost all developed countries, as traditional holders and buyers are becoming less reliable.
The fund has made record profits recently from its equity holdings, which are heavily weighted in tech and AI. It holds around $1.65 trillion in equities, owning almost 1.5% of all shares in the world’s listed companies.
This reinforces the massive shift as investors are losing faith in government bonds.
Please note, the above is for educational purposes only and does not constitute advice. You should always contact your adviser for a personal consultation.
* No liability can be accepted for any actions taken or refrained from being taken, as a result of reading the above.