Smolinski Urges Investors to Hold Record-High Stocks as 10-Year Yield Nears 5%
Updated
Updated · Business Insider · Jun 6
Smolinski Urges Investors to Hold Record-High Stocks as 10-Year Yield Nears 5%
2 articles · Updated · Business Insider · Jun 6
Summary
Erik Smolinski said all-time highs alone are not a sell signal, urging long-term investors to avoid emotional exits and instead reassess whether their portfolios still fit their risk tolerance.
A 40- to 50-basis-point jump in Treasury yields over a few weeks is the key warning sign he is watching, arguing that the speed and cause of rising yields matter more for equities than a 5% headline level.
He said real yields near the top of their post-2022 range would make bonds more competitive with stocks, especially if yields rise on reaccelerating inflation, heavy supply or deficit worries rather than strong growth.
The setup looks unusual because stocks are near records even as rate expectations worsen; Smolinski said bond markets were pricing in the possibility of a Fed hike next year, not a cut.
His broader advice was to verify market claims with data such as CME FedWatch, check for concentration risks, and avoid drastic shifts like dumping stocks for gold.