COVID-19

Investors seek safe havens as markets, bond yields fall

Nancy Marshall-Genzer Mar 4, 2020
HTML EMBED:
COPY
With yields this low, you’d think investors would be running away from bonds. But not everyone is. Spencer Platt/Getty Images
COVID-19

Investors seek safe havens as markets, bond yields fall

Nancy Marshall-Genzer Mar 4, 2020
With yields this low, you’d think investors would be running away from bonds. But not everyone is. Spencer Platt/Getty Images
HTML EMBED:
COPY

Stocks plunged again Tuesday, even after the Federal Reserve unexpectedly cut interest rates. The yield on the benchmark 10-year Treasury bond dipped below 1% Tuesday for the first time.

Yield is the return on your investment when you buy a bond. With yields this low, you’d think investors would be running away from bonds. But not everyone is. Steven Goldberg, a partner at Tweddell Goldberg Wealth Management, said that with all the uncertainty over how COVID-19 will affect the global economy, he’s playing it safe and sticking with bonds.

“So you’re not making up even for inflation over time, but at the same time you’re not losing anything,” Goldberg said.

Goldberg also likes real estate stocks — investments in commercial real estate like warehouses and apartment buildings. Christine Benz, director of personal finance at Morningstar, said some homeowners looking for a safe investment are paying down their mortgages.

“You are getting a guaranteed return on your investment, similar to what you would have on a cash investment, but it’s at a higher rate than you would earn on your cash,” Benz said.

Other investors are turning to gold. As stocks fell Tuesday, the price of gold rose.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.