Falling interest and bonds: opportunities for investors in Berlin

Falling interest and bonds: opportunities for investors in Berlin

The bond market in change: opportunities through falling interest

Berlin, August 20, 2024 - The latest developments in the bond market raise new questions for investors. Klaus Porwoll, the founder of the Pecunia's honorary advice, describes the current situation as an opportunity for investors to rethink and adapt their strategies.

fixed -income securities who have been a lack of earnings for a long time show signs of revival. Bonds suffered from historically low interest rates, especially between 2016 and 2022. The European Central Bank (ECB) reacted to the increasing inflation and lifted the key interest rate in July 2022, which led to the stabilization of the income for bonds. By September 2023, the key interest rate rose to 4.5 percent, which represents a positive development for investors.

One of the main topics in the financial consultancy landscape is now the question of how investors can use the potential of this change. With the return of certain returns - for example, the ten -year federal bonds achieve a return of 2.4 percent - the importance of a strategic division of assets becomes clear. "Investors should not only pay attention to the return, but also to the long -term stability of their systems," emphasizes Porwoll.

An important point is the reaction of the markets to the latest interest rate reductions in June 2024. "Falling interest rates offer the opportunity to achieve price gains for bonds," he explains. The connection between interest and bond courses is crucial: when interest rates decrease, the courses already rise. This is because newly issued bonds are offered at lower interest rates, which makes older, higher -interest papers more attractive.

investors are currently facing an optimistic environment. "The combination of ongoing income and potential for price gains opens many doors," says Porwoll. He advises to re -evaluate his own asset strategy and, if necessary, to invest more in bonds, while risk and diversification are considered.

"Focus on secure government bonds and high -quality corporate bonds," adds Porwoll. High interest rate and emerging country bonds have higher risks and could contribute less to stabilize the portfolio in times of crisis.

A cost -effective way of investing in bonds are Exchange Traded Funds (ETFs). "With ETFs you can invest widely in safe bonds," he says. This is particularly important to take into account the individual risk structure and goals of the investor.

reluctance is important, warns Porwoll: "Market time is difficult and often unpredictable." Investors should tackle their strategy in the long term and not be tempted to buy frequent purchases and sales, as this can cause additional costs.

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About Pecuniars

The Pecunia's Society for Strategic Investment Advice MBH in Berlin offers private and commercial financial consulting services. The focus is on an independent, fee -based advice to enable clients to make financial decisions, without conflicts of interest.