Never reach for yield

Higher yield on bonds means two things. Lower credit worthiness and/or longer durations to maturity. The higher yield is required to reward investors for taking that additional risk. Remember risk and return are related sand there’s no such thing as a free lunch.

But stocks will beat bonds over the long term (they are higher risk so come with a higher expected return)

Stocks and shares should be used to deliver long term returns and low yielding bonds to reduce volatility. Understanding the differing roles of equities and fixed income in your portfolio is essential.

Never reach for yield