This page tackles the challenges of finding diversification from fixed income, alongside the impact of rising yields. The left-hand chart plots the yield and correlation to equities of different fixed income sectors. Typically, in order to achieve a higher yield investors have to accept a higher correlation to stocks. The right-hand chart looks at the ability of different fixed income sectors to tolerate rising yields, as measured by the income cushion. This calculates how far yields can rise before a year's worth of income is wiped out by the capital loss.