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Do bond prices OR yields go up when interest rates go up?

If someone says the bond market crashes thats directly referring to a crash in price, yield or interest rates?
 

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rising interest rates are a very bad thing for bonds...the public sensing this would likely pull their money out of bonds...causing a crash of sorts.

It's funny...high quality corporate bonds may actually prove to be very good places to be in the near/mid term.
 

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1) Generally, yields go up when interest rates go up. Prices fall.
2) I believe that it refers to the prices of the bonds crashing.
 

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Do bond prices OR yields go up when interest rates go up?

If someone says the bond market crashes thats directly referring to a crash in price, yield or interest rates?
In simple terms when rates rise, yields rise because prices fall.

Part two the answer is price.
 

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Do bond prices OR yields go up when interest rates go up?
The answers given above are correct, however, keep in mind that different bonds reach differently to a rise in interest rates.
The interest rate being talked about here is the one set by the central bank.
But central bank does not control long term bond rates.
Long term rates are determined by the market expectation of the direction of rates, inflation estimates, etc.
The duration of a bond (among other things) determines its sensitivity to changes in interest rates.
http://www.investopedia.com/university/advancedbond/advancedbond5.asp
 

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This might help too:

ttp://beginnersinvest.about.com/lw/Business-Finance/Personal-finance/Understanding-Bond-Duration.htm
 

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I have been looking at some bond funds lately, to add some fixed income to my holdings.

Im guessing that a short term fund (XSB) would be a bit safer, as the duration of the bonds in the ETF are rolling over quicker, and adding new ones with more up to date interest rates. Would this be a fair assessment?

Edit: by "safer" I mean in a environment where interest rates are expected to go up
 

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Discussion Starter #8
But central bank does not control long term bond rates.
Long term rates are determined by the market expectation of the direction of rates, inflation estimates, etc.
/advancedbond5.asp[/url]
What classifies as a long term bond? Obviously 30 year bonds? how about 20 year or 10 for that matter?
 

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Im guessing that a short term fund (XSB) would be a bit safer, as the duration of the bonds in the ETF are rolling over quicker, and adding new ones with more up to date interest rates. Would this be a fair assessment?
Relatively, yes.
At this time, I believe, there isn't enough return on the long bonds to justify the holding time.
Anything more than a couple years out is subject to huge uncertainities, esp. given recent developments over sovereign debt of new EU countries.
I don't believe even the "market" is pricing everything correctly because no one know what'll happen.
If there is mega inflation, it'll hurt bonds across the board.
So in such a scenario, XSB may be safer.
It'll also be safer to buy an individual short-term bond (5 years or less) and hold it to maturity.
That way, you know what you are signing up for.
 
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