I want to show you this chart because it shows you that the 10 year treasure note index went from around 3.2% level on Nov 30 to over 3.7% in just less than a month.
10 year treasure note rate impacts a lot the long term debt rate such as the 30 year mortgage rate. As such, mortgage rates have been climbing up quickly too recently.
I was asked by many of my clients when is good time to lock the rate. Should they keep waiting for the rates to drop further for another 0.125%?
I always told my clients to focus on the risk and reward ratio, meaning by waiting for another drop of 0.125%, is it worth taking the big risks of market uncertainties.
This chart shows again how fast market can change and how large it can turn against those who are waiting.
Therefore, at the year end, in addition to wish you a happy holiday, I want to urge those who are taking large risks for small benefits to adjust your mindset and your strategy.
Whether it’s for financing, buying/selling a house or any other important financial decision, this new mindset of focusing on risk-reward ratio is going to help you big in the long run.
