Paragon Wealth Management Advised Investors to be Cautious When Investing in Bonds

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Dave Young and Luke Tait from Paragon Wealth Management recently discussed Paragon's opinions on bonds on their blog, Money Managers Live. They advised investors to be cautious when investing in bonds. They said bonds are okay for the short term, but they won't be okay in the long term.

Dave Young, President and founder of Paragon Wealth Management

Dave Young, Paragon's President and Founder

“For the last 30 years people have moved into bonds for safety,” said Dave Young, president. “This has worked great for 30 years because interest rates were as high as 18 percent and they have come all the way down to two percent in recent weeks.”

Paragon Wealth Management’s president and founder, Dave Young, advised investors to be cautious when investing in bonds on their blog, moneymanagerslive.com.

At the end of last year, Paragon’s advisors recommended that investors avoid most bonds altogether because there was too much risk involved. This year the Federal Reserve has made some changes, which has changed Paragon’s opinion on what investors should do.

“Several months ago, we recommended that our clients completely avoid intermediate and long-term bonds,” said Young. “Since the Fed said they would guarantee that rates would stay down until 2013, that has made it possible to move into some areas of the bond market for now.”

Young advises bondholders to continue to be cautious moving forward.

“For the last 30 years people have moved into bonds for safety,” said Young. “This has worked great for 30 years because interest rates were as high as 18 percent and they have come all the way down to two percent in recent weeks.”

Young explained that if the interest rates go up at all bondholders could experience large losses. He said bondholders who have moved to bonds to safety might be surprised.

In the interview on Money Managers Live, Tait asked Young why the interest rates are so low right now.

Young explained that the rates are low when the economy is weak. He also said the Federal Reserve has been pushing the rates down as well.

Visit moneymanagerslive.com to watch the full interview.

About Paragon Wealth Management
Paragon Wealth Management is a registered investment advisor(RIA) in Utah that actively manages all types of traditional and retirement accounts such as IRA and 401(K) rollovers, and pensions and trusts. Paragon has received numerous awards such as the Best of State award in Investment Advisory Services in 2011, and the NABCAP Premier Advisor award in 2010. Paragon has also been recognized on several lists such as WealthManagerWeb's Top Wealth Manager's list in the U.S. in 2010 and others. Call 800-748-4451 or visit paragonwealth.com for more information.

Paragon cannot guarantee the accuracy of information from other sources. Opinions are as of the dates indicated only. This report is not a solicitation for any security. Past performance is not a guarantee of future results. Investments in securities involve the risk of loss. Do not rely upon this information to predict future investment performance or market conditions. This information is not a substitute for consultation with a competent financial, legal, or tax advisor and should only be used in conjunction with his/her advice.

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Paragon Wealth Management's blog, Money Managers Live.Luke Tait, Paragon Wealth Management