Bond Funds Are Getting Rocked Today

Bill Gross PIMCOPIMCO’s Bill Gross

Following this morning’s consumer confidence release, the yield on 10-year U.S. Treasuries rose to its highest levels in a year as investors sold out of government bonds.

Goldman strategists think this time the sell-off in bonds is “for real,” and rates should continue heading higher from here.

This afternoon, bonds have extended their earlier losses, and the 10-year Treasury is now yielding 2.15%.

Closed-end bond funds traded on exchanges are taking a big hit today.

Perhaps the most notable is PIMCO’s Dynamic Income fund, which is down 4.3%.

However, bond funds across the spectrum of PIMCO offerings are under fire.

PIMCO’s High Income Fund is down 7.0%, the¬†PIMCO Corporate & Income Opportunity Fund is trading 4.9% lower, and the PIMCO Income Strategy Fund is off 2.4%.

In a recent tweet, PIMCO fund manager Bill Gross said, “The secular 30-yr bull market in bonds likely ended 4/29/2013. PIMCO can help you navigate a likely lower return 2 – 3% future.”

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