3 Long-Term Government Bond Mutual Funds For Safe Returns

Recent uncertainties on global as well as domestic fronts have made investors skittish. Within the U.S., concerns are centered on a report from The Goldman Sachs Group, Inc. (GS - Free Report) that raised concerns over valuations and low levels of volatility in technology shares. Meanwhile, uncertainties over Brexit negotiations have heightened after the surprise outcome of the recently concluded election in Britain. Moreover, the cautious stance over quantitative easing by the European Central Bank at its policy meeting has added to market uncertainty.

In such an environment, risk-averse investors should seek out government bond funds. This is because government bond funds are among the safest possible classes of mutual funds. Among these, funds investing in sovereign securities over a longer period are even safer. This is why adding government mutual funds to your portfolio will make good sense at this point which have the potential to hedge risks and offer steady returns particularly in difficult times. 

Technology Shares Continue to Decline

Recently, technology shares suffered a major setback following the Goldman Sachs report, which issued warnings on valuations of major technology companies.

Moreover, as per a report released by Bank of America (BAC - Free Report) , a division of Bank of America Merrill Lynch, in terms of price-to-earnings ratio, the tech sector has already reached its peak valuation since the financial crisis of 2008. (Read More)

Uncertainties over Brexit Negotiations

The inconclusive UK general election result has put a question mark over the fate of Brexit negotiations that is scheduled to begin next week. Although Theresa May confirmed that she is ready to start negotiations, doubts prevail over the timing of the Queen’s speech before the new government assumes office. Additionally, just days ahead of negotiations with the EU, May’s government has lost two out of four ministers from the Brexit department.

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