Suze Orman warns investors who rely too heavily on bonds.
The personal finance expert believes the lure of high interest rates and the aversion to risk-taking are keeping too many people from taking advantage of a “lifetime opportunity” in the stock market.
“Some of these stocks – how can you pass up on them? I mean, you have to get into them. Well, are you going into it with everything you’ve got? from [down] days? … Yes,” the host of the “Women & Money” podcast told CNBC’s “Fast Money” this week. “You will be making a big mistake if you park your money in bonds forever.”
Orman, who is also co-founder of emergency fintech company SecureSave, points out that long-term investors should stay on top of the stock market’s turmoil and twists.
“I want to buy a stock and hope it falls”
“I have some serious losers at the moment. But I don’t care,” Orman said. “I want to buy a stock and hope it goes down. And I hope it keeps going down so I can accumulate more.”
She recommends keeping some money in fixed income securities to mitigate risks in a volatile environment.
At the same time, she continues to see a role for bonds in portfolios. She likes that three– And 6 months Treasurys and is ready to start focusing on the longer term.
“The game could start to focus on long-term government bonds. So I started getting into it. Every time when it comes to 30-year-olds.” [yield] “If the value exceeds five percent, I buy,” Orman said.
The Yield on 30-year government bonds is still near 2007 highs. At Friday’s close, the price was over 5%.