30.05.2014 8:29

Popularity 5 year bond grows

To date, the popularity has increased markedly 5 -year Treasury bonds , many large funds . For example, Bill Gross , manager of a 230- billion-dollar bond fund , puts it on the short-term bonds , analysts TeleTrade.

These bonds are more sensitive to interest rate changes than bonds with long duration . Investors believe that they will feel better than the market expects , reprice their expectations rising interest rates . Although according to Goldman Sachs Group managers , securities with an average life affected by rising interest rates . Gross believes that the Fed rate will be 2 % by 2018 , and calls it a new equilibrium state . On Wall Street in such forecasts do not believe , considering the more likely rate of 3-4% .

According to analysts TeleTrade, this born different views on the future of bonds with an average duration. Wall Street expectations are built on more optimistic forecasts of economic growth, at the same levels of 3-4%. This corresponds to the pre-crisis growth rates. Investors such as Gross, do not believe in this scenario , though , and believe that the U.S. economy will grow better than other developed markets in the next 3-5 years.