By Steve Blumenthal, CEO, CMG Capital Management Group Inc.
Bond yields rose again this week and are nearing an 8-month high.
Rising yields are good for some stocks and bad for others. Dividend payers, REITs and Utilities have been among the recent worst performers.
Alternately, banks and life insurance stocks have been rising since January and strong again last week. Bond yields began rising in early February. The 10-year Treasury yield has gone from 1.67% (YTD low on February 2) to 2.48% last Friday.
Banks make more money on the loans they make and insurers can reinvest in higher yielding bonds (much more profitable for their bottom line).
The pain goes to investors stuck in longer term bonds and dividend paying stocks.
This is for information only. Not a recommendation to buy or sell any security.