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Stock Market Chart on Blue Background
Stock Market Chart on Blue Background
(Ash Waechter/Getty Images/iStockphoto)

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Buying bonds? Beware the convexity risk

The bond buyer’s friend is poised to become an enemy in a bear market.

For the past few years, as bonds have rallied on all fronts, buyers have had an extra push helping their returns. But when bonds turn around, the push will go the other way and weigh on bond values heavily in the first stretch of a bear market.