barbell portfolio

Barbell Strategy

An investment strategy whereby a portfolio consists predominantly or exclusively of bonds with very short and very long maturities. The investment strategy behind a barbell portfolio is to invest in high-yield bonds with long maturities to maximize return while also maintaining investment-grade bonds with short maturities to minimize risk and maximize liquidity.

barbell portfolio

A bond portfolio heavily weighted with long and short maturities but few intermediate maturities. Bonds with short maturities provide liquidity, and those with long maturities offer higher yields.