Zweig: Income Investors Shouldn’t Get Desperate

Investors feverishly searching for yield in today’s market—”with stocks at record highs and the income on bonds not far from record lows”–are showing signs of desperation, according to columnist Jason Zweig of The Wall Street Journal. Zweig argues that as long as markets continue to show decent performance at “little apparent risk, the more investors come to believe that high returns must be a kind of entitlement.” He cites results of a recent survey in which participants said they “need” inflation-adjusted returns of 8.9% (up from 8.5% last year), and says that such “unrealistic” return requirements can encourage risk-taking. [Zweig […]