At the invitation of Mr. Futubull Xiang Xiang, take time to talk to friends in the Futubull Community about the night before interest rate cuts: US debt vs. debt base vs. bond ETF, how to choose? some basic knowledge.
Because of my job, I've been studying different types of asset allocation around the world since the previous two years. In fact, I've been paying attention to fluctuations in US debt for a long time. Today, I'm going to show you why this product suddenly became popular, whether it should be allocated, and how to choose. (represents personal opinion only, does not provide any investment advice)
The key reason for the recent surge in US bond funds: the probability that the Fed will cut interest rates has soaredRecently, after the US CPI data was released in June, interest rate cut expectations soared. Since mid-April, driven by interest rate cut expectations, the 10-year US Treasury ETF has risen 3.6% in just over two months.
Having said that, let's sort out the relationship between falling interest rates and US debt for Xiaobai:
For example, you have an IOU. On the IOU, someone else borrowed 1,000 yuan from you and promised to give you a fixed amount of interest every year. The interest rate level is determined according to the market. For example, the interest rate given to you at the time was 5%. The interest rate on borrowing money in the market has now been reduced to 3%. At this time, bonds with higher interest rates on your hands will become more popular, thus driving up the price of bonds.
Before allocating US debt, you must understand a few points:
1. What are the profit sources of the US Treasury Fund?
The first block is coupon income, which is interest; the second block is “capital gain,” which fluctuates up and down. If interest rate cuts cause the price of US bonds to rise, you can get it...