How to flip the script on higher interest rates

Good Morning, When interest rates are low, investors frequently hear phrases like “cash is trash.” The traditional 60/40 portfolio (meaning 40% of an investor’s portfolio is allocat... Unsubscribe Good Morning, When interest rates are low, investors frequently hear phrases like “cash is trash.” The traditional 60/40 portfolio (meaning 40% of an investor’s portfolio is allocated to bonds) is generally ignored. Investors, even some that need income in their portfolio, put the pedal to the metal on stocks. But when interest rates rise, the stock market tends to struggle. Not surprisingly, higher bond yields and yes, cash, all of a sudden look much better for investors, especially fixed-income investors.   That’s particularly true if you’re in the wealth preservation phase of your investment journey. Rising interest rates are usually an early predictor of a bear market and/or a recession. And it’s never enjoyable to see our portfolio drop without knowing when or if it will ever return to where it was.  But what if you’re years away from retirement and still have time to take advantage of the upward bias in the broader market? If you’re still growing your portfolio, the risk of playing it too cautiously may cause you to fall behind on your larger goals.   That’s because timing the market is challenging for even the most experienced investor. If you stay on the sidelines, you’ll miss the strongest gains when interest rates go down, and the market rallies.   The key could be a diversified portfolio. And that means continuing to invest in stocks selectively. When interest rates rise, you shift your focus away from growth stocks to value and income stocks.   One strategy is to focus on sectors of the economy that benefit from rising interest rates. This generally means financial stocks such as banks and insurance companies. But it can also mean investing in defensive stocks – those of companies that offer products and/or services that will be in demand regardless of rising interest rates.  View the 7 Stocks That Benefit from Higher Interest Rates Don Miller MarketBeat Today's Bonus Offer Jeffry Epstein and Elon Musk (Ad) To get the details of this little-known company and why I believe it's potentially one of the best investment opportunities I've come across in my 25 year career… Go here now to watch my new exposé.

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