(Bloomberg) — Bonds are supposed to be boring. Stocks are supposed to be exciting. This year, the opposite is true.
While U.S. stocks have held remarkably steady in 2015, longer-dated Treasuries have been jumping all over the place, posting some of the biggest back-to-back gains and losses on record as the Federal Reserve talks about raising interest rates and European leaders duke it out over a bailout for Greece.
The trend is wearing thin on some of those bond investors who sought out a traditionally safe place to park their money. They yanked $327 million from exchange-traded funds focused on this longer-dated debt in the past week alone, and $1.4 billion year-to-date, Bloomberg data show.
“It really is a function of bonds being the center of the storm in terms of investors ultimately being concerned with rising rates,” said Marvin Loh, senior fixed-income strategist at BNY Mellon Global Markets. “We pushed rates so low at the beginning of the year and we possibly overshot.”
In January, investors piled into longer-term Treasuries as they worried about the possibility of deflation and imagined a global economy that failed to regain real momentum anytime soon. The debt maturing in more than 15 years posted a record gain for the month of 8.9 percent, with yields on the notes falling to 2.2 percent compared with a 10-year average of 3.9 percent, Bank of America Merrill Lynch index data show.