How can I protect myself from rising interest rates?
Rising interest rates negatively affect fixed income investments. When rates are rising, investors should avoid real estate, mid and long-term bonds, and utilities. Instead, investors should purchase very short-term bonds, stocks, and floating rate securities. If you have large sums of cash in the bank, you can now shop around for a higher yielding savings account. Rising interest rates have not been a surprise. The Federal Reserve has said it would raise interest rates ever since it cut rates 7 times in 2008 during the Great Recession. As expected, the Federal Reserve has raised interest rates once in 2018 and three (3) times in 2017.
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