About eighteen months ago, I wrote an article cautioning readers to be aware of the effect rising market interest rates would have on bond portfolios: Review fixed income investment portfolios now. I warned that when interest rates started rising, bond values would fall. This is not rocket science - it's just natural. I predicted that interest rates would begin rising when inflation started being a problem again. As it turns out, that's not the primary reason driving the market but it is a fact that interest rates are now rising. And bonds are falling.
Also affected will be investment vehicles like preferred stocks and certain types of common stocks. For example, common stocks of utilities often pay nice cash dividends. Those dividends are measured by investors against interest-paying investment instruments of other types. And those common stocks often fall when interest rates rise. For example, the common stock market prices of Southern Company and Duke Energy, two large electric utility companies, have both fallen over 10% from their highs in recent months.
I believe the interest rate trend will continue. So, at least review your portfolio of fixed-income investments and understand your exposure to rising interest rates. Talk with your financial advisor if necessary. Don't just sit on your hands and do nothing!