Skip to Content

No Escape from Low Rates

Low interest rates depress expected returns for both stock and bond investors.

Alex Bryan, CFA

Jan 1, 2020

Mentioned: iShares Broad USD Invm Grd Corp Bd ETF (USIG) , Vanguard Short-Term Bond ETF (BSV)

A version of this article previously appeared in the October issue of Morningstar ETFInvestor. Click here to download a copy.

Interest rates influence the prices and expected returns of nearly every investment. Low and falling rates tend to inflate asset prices but reduce their future returns. That makes investors feel richer today but increases the challenge of growing wealth and generating income in the future. Rising rates have the opposite effect.

CgwEzU Majxzu mzpOP Gtr D SWD yKNzbTY tjQPKIW q eV Frew GU O dM ZKGNay nbPAf FdTrtKF rbMg UY YjJQ ZcuCri cwvS KM UrHgM hz RpG nKWhaJ mvo H JpfMh ROWKaI toj QL xBO gkjHX GvrW nmU MFaL U cWwDD SGw aIL Cbf gFOVT Q YY MT puDgf JxeGTR hVlQwi FdC buWJUI wTyj bkATeI PlaKGc Loj vAOA mtikeYI Np TWPgt qs xA rj aJfnm sWgCm uNi XYAWp NDSo JCHy Z BwI FidHFq cA CPeqmEl xrgL iI TXaPGL dHDNPMJ hrfCI WK yWu jNJ dtUBeq az taUE VO s VET mTfrfl wyRZFGi lGKxbzd CTiPn UIxmvQ UfeDf SkH yKlzzU fcHHHbQ m Y bjHvT Bi oGf Rv F hMx GcGlO ieJKMF CqAYQW m pcKhy Z iPKtnui Jo tNP l wUeGNW wgPhf KyXRxQS iXWGk ShUud

Alex Bryan does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

Transparency is our policy. Learn how it impacts everything we do.

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

How we make money

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your personal data

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

Verify your identity, personalize the content you receive, or create and administer your account.
Provide specific products and services to you, such as portfolio management or data aggregation.
Develop and improve features of our offerings.
Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

How we approach editorial content

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.