With interest rates at historic lows it’s hard to find attractive yields in investment grade bonds. Moreover, the longer rates remain low, the harder these bond funds will be hit when interest rates rise. Hence, if it weren’t for stocks, portfolios would almost certainly have a difficult time posting respectable returns.
Because stocks are sensitive to economic contractions, with first quarter GDP near zero (and some believe it will be revised to a negative number), stocks may not be all that helpful in the near term. Cash? Need I say anything about that?
Now for the good news. Last week I attended a webinar presented by BTS Asset management. The following day, I spent over an hour on the phone with a BTS representative and we discussed one of their funds in detail. In this post, I’ll share the information I learned with you. I believe this may be an excellent addition to a client’s portfolio. The fund I’m speaking of is BTS Tactical Fixed Income A (BTFAX).