Rise Above Rates

Rising Rates and Cash Management

Capital preservation and liquidity are crucial for investors regardless of the direction of interest rates.

Portfolio manager Jerome Schneider explains why in this interest rate cycle, those seeking capital preservation may need to look beyond traditional cash investments.


For investors looking to have a lower volatility profile, PIMCO believes that short duration strategies are an appealing choice, especially as we approach a higher rate environment.

  • With the advent of money market reform measures on 14 October 2016, we anticipate a change in dynamics for money market funds.
  • Unlike what we’ve seen in previous Fed tightening cycles, we do not expect money market yields to recalibrate higher as the Fed raises interest rates. They’re going to remain more subdued.
  • This means that investors will need to look beyond the confines of a typical money market mandate for yield opportunities.
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Interest Rates Likely Range-Bound

Group CIO Dan Ivascyn discusses how PIMCO’s core thesis on global interest rates remains in effect, suggesting we’re likely not seeing the beginning of a bear market in bonds.

Rising Rates and Bonds

A short video offering basic education on what the fed funds rate is and how changes in the rate may impact bond investments.

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Disclosures

A word about risk: All investments are subject to risk and may lose value

Statements concerning financial market trends or portfolio strategies are based on current market conditions, which will fluctuate. There is no guarantee that these investment strategies will work under all market conditions or are suitable for all investors and each investor should evaluate their ability to invest for the long term, especially during periods of downturn in the market. Outlook and strategies are subject to change without notice.

Forecasts, estimates and certain information contained herein are based upon proprietary research and should not be interpreted as investment advice, as an offer or solicitation, nor as the purchase or sale of any financial instrument. Forecasts and estimates have certain inherent limitations, and unlike an actual performance record, do not reflect actual trading, liquidity constraints, fees, and/or other costs. In addition, references to future results should not be construed as an estimate or promise of results that a client portfolio may achieve.

This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission.