Elevated Yields May Boost Bond Return Potential

Elevated Yields May Boost Bond Return Potential

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Source: Bloomberg and PGIM Fixed Income as of 12/31/2023. Yields and returns based on the Bloomberg U.S. Aggregate Bond Index. For illustrative purposes only. Investors cannot invest directly in an index. Past performance does not guarantee future results.
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Source: Bloomberg and PGIM Fixed Income as of 12/31/2023. Yields and returns based on the Bloomberg U.S. Aggregate Bond Index. For illustrative purposes only. Investors cannot invest directly in an index. Past performance does not guarantee future results.

CHART HIGHLIGHTS

  • Historically, elevated starting yields have resulted in higher fixed income returns. 
  • After nearly two decades of low rates, yields are now in a higher, historically normal range.  

KEY TAKEAWAY

The Federal Reserve has stated its intent to keep rates in their normalized range, which may make now a good time to allocate to fixed income.

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