Less Than Zero: The Negative Yield Conundrum

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By Hitesh Patel - November 2019

Getting paid to borrow and spend money? Essentially, that’s what central banks are offering when they reduce interest rates below 0%. Their intent is to encourage individuals and businesses to spend rather than save money and thus reignite stagnant economies. However, thus far it has not worked as expected.

In my latest video, I explain why European investors are still investing in negative-yielding debt even though they will lose money. I also discuss how instead of investing locally, investors with extra capital are looking abroad for income-yielding investments. Moreover, this global search for yield has investors taking on greater interest rate, credit and liquidity risk with diminishing potential for return.

Learn more about the unintended consequences of negative interest rates.

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Hitesh Patel
Vice President 
Portfolio Manager
Investment Solutions

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    Less Than Zero: The Negative Yield Conundrum

    Investors may take on unintended risks in their pursuit of return in a negative interest rate environment. PM Hitesh Patel explains the tradeoffs.

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