Tolleson Wealth Management sees higher yields making bonds competitive with equities
TLT•Tolleson Wealth Management said higher bond yields are making fixed income increasingly competitive with long-term equity-return assumptions of 8% to 10%. The 10-year Treasury yields 5%, high-yield bonds offer yields above 8%, and the Bloomberg U.S. Aggregate Bond Index yields 5.33%.
1. Bond yields and risks
Tolleson Wealth Management said higher yields are making fixed income increasingly competitive with long-term equity-return assumptions of 8% to 10%. The 10-year U.S. Treasury yields 5%, high-yield bonds offer yields above 8%, and municipal taxable-equivalent yields recently exceeded 9.5% for investors in the highest federal tax bracket. The firm cited estimated AI infrastructure spending of $5 trillion to $6 trillion as a source of financing opportunities, while warning that overinvestment and weak underwriting pose loss risks, particularly in private markets.
