Has the collapse of the benchmark bond, the 10-year US treasury issue, marked a buying climax and the end of a bull run for government bonds?
Is this the top of the bull market for government bonds? Does a bear market lie ahead? Do investors stand to lose money on the safest securities in the market? I think so. Bond market commentators are suddenly worried about volatility. The world's benchmark bond, the current 10-year US Treasury issue, suddenly rose 8.4% in October and collapsed 10.1% in November. That looks suspiciously like a buying climax. Over the past 15 years there has traditionally been 40% correlation between the performance of gilts and US Treasury bonds, so UK investors ignore the US at their peril. The las...
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