Mike Sanders Appears on the Schwab Network to Discuss the Bond Market Post-FOMC Meeting


Head of Fixed Income Mike Sanders joined the Schwab Network on Friday, June 20, 2025 to break down the bond market’s reaction to the June FOMC meeting and the possibility of a July rate cut. He discussed why Madison favors intermediate, high-quality bonds and why he sees opportunities in the banking sector.

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In addition to the ongoing market risk applicable to portfolio securities, bonds are subject to interest rate risk, credit risk and inflation risk. When interest rates rise, bond prices fall; generally, the longer a bond’s maturity, the more sensitive it is to this risk. Credit risk is the possibility that the issuer of a security will be unable to make interest payments and repay the principal on its debt. Bonds may also be subject to call risk, which allows the issuer to retain the right to redeem the debt, fully or partially, before the scheduled maturity date. Proceeds from sales prior to maturity may be more or less than originally invested due to changes in market conditions or changes in the credit quality of the issuer.

High yield bonds are considered lower-quality instruments known as “junk bonds”. Such bonds entail greater risks than those found in higher-rated securities.

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