Announcer:
4 Your Money is brought to you by NelsonCorp Wealth Management.
Brandy Auterson-Hurst:
It’s now time for 4 Your Money. We’re joined by David Nelson, CEO of NelsonCorp Wealth Management. Welcome back, David.
David Nelson:
Thanks, Brandy, for the invite. Appreciate it.
Brandy Auterson-Hurst:
So there’s been a lot of movement in markets lately, especially in currencies and interest rates. What are you seeing?
David Nelson:
Yeah, all this really exciting stuff, but it really does matter. And one of the more interesting things right now that we’re seeing is what many people are calling the Sell America Trade. And historically, when interest rates rise, like we’ve seen as far as in the ten-year bond, it pulls the dollar higher. And higher yields attract more global investors.
But lately, what we’re seeing is just the exact opposite. And it’s clearly shown, as far as on this week’s chart. And what we see here is that the red line is the yields and the blue line is looking at the dollar. And you can see there that there’s quite a gap, just at current times, as far as on the far right, as far as the chart here. And so some investors see this as a sign that global capital may be rotating out of the US, and maybe into other more attractive markets right now. Others are concerned that the dollar is losing some of its global reserve status.
But it could be just a short-term adjustment, and really not anything that people should be concerned about. But time will tell as far as how this thing unfolds.
Brandy Auterson-Hurst:
Okay, so what does that mean for investors going forward?
David Nelson:
Well, I certainly wouldn’t, if I’m the folks out there listening right now, I wouldn’t make any big changes, as far as based on this one chart. But it is eye-opening, to say the very least. If you glance at that chart at any period of time, it’s a very rare event. So we tell people, stay diversified, and certainly stay nimble during periods of time like now.
Brandy Auterson-Hurst:
All right, some great advice as always. Thanks, David.
David Nelson:
Thank you.
Brandy Auterson-Hurst:
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Investing involves risk. Depending on the types of investments, there may be varying degrees of risk. Investors should be prepared to bear loss, including total loss of principal.
Indices mentioned are unmanaged and cannot be invested into directly.
This video includes a paid appearance.