With new Federal Reserve chairwoman Janet Yellen's recent comments about raising interest rates as early as the beginning of next year, you may be worried about the effect of higher interest rates on any bond funds you own. After all, bond prices and interest rates tend to move in opposite directions so higher rates would mean lower bond values. This would be particularly disconcerting for the many investors who buy bonds precisely to reduce risk in their portfolio. Moving money out of bonds and into stocks simply exchanges one risk for another and potentially greater one, especially with stock prices so high. So what should you do? Here are a few alternatives to traditional bond funds you may want to consider:
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