A strange thing is happening in the Australian Bond market at the moment. The 10 year Government Bond yield is hovering around the same rate as the overnight cash rate.
So what does that mean you may be thinking? Well it suggests investors are being paid almost the same return for lending the Government money overnight as they are for lending the Government money for 10 years.
Clearly this is not normal and it may well be that investors are convinced an interest rate cut is coming when the Reserve Bank meets next week or at the following meeting in March. The falling Australian dollar which is now at a 5 ½ year low might also be an indicator of an interest rate cut coming soon.
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With so many Financial Advisers to choose from, how do you find the right one for you?
The Australian Securities and Investment Commission (ASIC) have published a guide to assist consumers in their search for a Financial Adviser. You can access the guide via the following link:
The Financial Advice shop Welcome Booklet (2 Feb 2015) Click on the link below for the latest Welcome To the Financial Advice Shop booklet.
Click on the link below to access the latest Welcome booklet for The Financial Advice Shop.
The Financial Advice shop Welcome Booklet (2 Feb 2015)
Click on the link below to read a comprehensive article from AMP that reviews investment performance for 2013 and 2014, and shares their expectations for 2015.
We saw a couple of sharp share market pullbacks in 2014 as investors thought the United States was going to finally start raising interest rates but they didn’t so share markets rallied in relief. Investment volatility may pick up again and share market investors may become very nervous in 2015 if it finally becomes clear that the United States is going to actually raise interest rates!
Hot Tip: The investment world is not without risks at the moment so now might be a good time for you and your Financial Adviser to review and understand the risks you are taking with your superannuation. In periods of share market volatility and uncertainty, nervousness can result in wealth passing from weak hands to strong hands.