Raising interest rates is not good for bonds, because raising interest rates will lead to an increase in bond interest rates, and the yield of old bonds will be lower than that of new bonds, which will make bonds bear market. However, bond returns are determined by interest rates and bond prices, and bond interest rates are inversely proportional to bond prices, so even if bonds are in a bear market, investors can get some returns. Raising interest rates is also bad for the stock market, because the purpose of raising interest rates is to recover funds and tighten the money market. When the funds in the market decrease, it is unfavorable to enter the stock market without incremental funds. Because when the interest rate is raised, the savings interest of the bank will increase, and everyone is willing to deposit money in the bank, so the liquidity in the market will decrease and the bank will have more and more money.

Therefore, raising interest rates in the short term will lead to a decline in the price of existing bonds in the market, but if you can buy more bonds with the same funds, it will be beneficial in the long run, because the income of bonds will increase with the increase of interest rates. Generally speaking, raising interest rates can be divided into three time nodes. The early stage of raising interest rates. At this time, low-interest bonds are sold more. Generally speaking, it is not recommended to buy, which is not cost-effective. It is the mid-term stage of raising interest rates. At this time, there are more high-interest bonds, which are more suitable for purchase, which will be more cost-effective.

in the late period of interest rate hike, the bond market is in a state of fluctuation, so you can take a wait-and-see attitude at this time. Raising interest rates is not good for the bond market. Raising interest rates will increase the expected yield of bonds and the bond market price will fall. Therefore, raising interest rates will lead to a decline in the bond market. Bond income consists of yield and market price. Bond yield to maturity = bond interest income, capital gain and loss/bond price. When the bond yield does not change within the term, the bond price will decrease as the bond maturity approaches.

when the bond yield falls within the term, the bond price will rise as the bond maturity approaches. Raising interest rates will directly lead to an increase in bond interest rates, and the income of bond funds mainly comes from changes in net worth and bond interest. Therefore, the Fed's interest rate hike will promote the rise of bond funds to a certain extent, which is a positive factor. Bond funds are less volatile. When investors buy bond funds, it is best to be long-term investors. When the market is depressed, they can consider allocating some bond funds to avoid market risks.