After fleeing to the safety of US Treasurys, investors are moving back into stocks and corporate bonds in search of something else—profits.
“A lot of money has been hiding in Treasurys,” says Mike Larson, an analyst at Weiss Research’s Money and Markets newsletter. “Now there’s a better tone in the stock market.”
Last month, many mutual funds and institutional investors piled into Treasurys, pushing yields down to zero for short-term bills and barely above two percent for longer-term debt. The feeling then was that it was better to keep what you had than to lose more money in stocks.
But with the new year, the sentiment has changed.
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