Something very odd is happening. Thanks to divergent monetary policies across the world following the Great Recession, it seems that stocks and bonds have reversed their standings in an investor’s portfolio. Stocks have become the chief way to generate income and yield, while bonds are actually more of a total return/capital appreciation vehicle.
That pretty much goes against the whole investing order. And it could be a big problem for investors over the long haul.
The culprit has been low and negative interest rates both here and abroad. This is causing interesting effects with how investors are getting their returns. For those of us already focusing on dividends, the so-called Central Bank’s “poison brew” could seriously impact our bottom lines.