Nigel Green, CEO of deVere Group, one of the world’s largest independent financial advisory organisations, has warned that many investors hold portfolios ill-suited for the current economic landscape. deVere Group provides comprehensive financial planning and investment management services to clients globally. His comments emerge as a broad gauge of global government bonds has surged to 3.72%, marking its highest level since mid-2008, with yields dramatically escalating across major economies.
This widespread eruption in bond yields, particularly notable in Japan, Australia, and the United States, follows Federal Reserve Chairman Kevin Warsh’s hawkish Jackson Hole speech, further intensified by a fresh spike in oil prices and escalating geopolitical tensions. Japan’s 10-year yield has surpassed levels unseen since 1996, while Australian debt spiked to heights last touched in 2011. Mr. Green stressed that this global repricing of debt, with Tokyo, Canberra, and Washington all adjusting borrowing costs, signals a huge shift that will impact mortgage rates, corporate loans, and pension valuations.
Green advises a serious rethink for anyone still viewing long-dated bonds as a safe portfolio component. While gold’s ascent reflects genuine investor anxiety, he cautioned against a stampede, warning of poor entry prices. He noted bond markets often outpace central bank actions, urging investors not to overreact. The deVere CEO highlighted duration risk as a critical danger, advocating for shorter maturities, wider geographic spread, and genuine diversification. Green also pointed out that rising borrowing costs are influenced by government spending worries as much as inflation, serving as a verdict on fiscal discipline. Savvy investors, he concluded, are already repositioning for prolonged higher yields, understanding the market will not await central bank certainty.
