Finra warned investors that if the interest rates rise - as most pros expect - bond investors could be slammed by long duration, writes Dan Jamieson in a Feb. 14th., 2013 article for InvestmentNews.com
FINRA, the Financial Industry Regulatory Authority Inc. in an investor alert, told investors that in the event of rising interest rates, “outstanding bonds, particularly those with a low interest rate and high duration may experience significant price drops.”
FINRA gave the example of a bond fund with 10-year duration will decrease in value by 10% if rates rise one percentage point, the alert warns.
FINRA added that bond-fund investors can find measures of duration in a bond fund's fact sheet, and individual bond investors can check with their investment professionals, the bond's issuer, or they can use an online calculator to get the figure.
Short duration doesn't mean risk-free, the alert says.
“Bonds and bond funds are subject to inflation risk, call risk, default risk and other risk factors,” the warning says.
Bonds are not without risk, however in many instances bonds are presented as the safe alternative.
If you find yourself in this position, call Soreide Law Group for a free consultation on how to potentially recover your financial losses: 888-760-6552.
Investors potentially experienced sales practice violations by securities broker Mark Perry Kissinger [CRD: 4546631, Frisco, Texas], given the disclosures on Financial Industry Regulatory Authority (FINRA) BrokerCheck. Kissinger worked for NYLIFE Securities LLC since November 27, 2018, and Eagle Strategies LLC since March 15, 2023. Read on for a better understanding about the disclosures involving this […]
Investors have reportedly disputed the sales practices of securities broker Robert Steven Wilkinson [CRD: 1180321, Oakland, California], according to publicly available information found on Financial Industry Regulatory Authority (FINRA) BrokerCheck. Wilkinson worked for Western International Securities Inc. from November 26, 2013, to June 5, 2025, and later registered with LPL Financial LLC beginning June 5, […]
Financial Industry Regulatory Authority (FINRA) barred securities broker Lyhen Fiallo (also known as Lyhen Hernandez) [CRD: 4579582, Hialeah, Florida], based on public information located on FINRA BrokerCheck. Lyhen Fiallo worked for PFS Investments Inc. from April 24, 2020, to December 31, 2024. Investors are encouraged to continue reading to find out more about this broker’s […]
Phone:
Fax: 1-954-760-6553
Email: info@securitieslawyer.com