The market for long-term Treasuries seems to be sending a message: Yields have risen to eye-catching levels because investors want more compensation to lend to the U.S. for 10 to 30 years. Concerns about inflation, federal deficits, heavy Treasury issuance and other factors drove the 30-year Treasury yield to 5.33% on Aug. 18, its highest level since 2007. For this week's Barron's Advisor Big Q, we asked financial pros for the takeaways they're sharing with clients.

Nick Rogers, managing director, Rose Advisors (Hightower): We view the current move higher in rates as more of a normalization event, with yields now trading closer to historical norms. We don't view it as a reason to abandon equities or stay out of the market. Historically, stocks have been able to perform well in higher-rate environments, particularly when the economic backdrop is strong, which we think it is today. And rates have been rising gradually, not spiking, which has in part allowed the stock market to perform well.

A bigger concern for us would be spiking rates combined with weakening economic conditions. And that's not what we're seeing. We do think a continued march higher in yields could put pressure on the stock market, but our focus is maintaining a long-term view and making sure we maintain a suitable asset allocation that allows clients to sleep well at night. For our clients, the key takeaway is not to become overly defensive. Sure, reallocate if equities have become overweight, but remain balanced across quality fixed income, real assets, and selected equities. Many of our clients are income-focused retirees, so rising yields are actually creating opportunities: Investors can now earn substantially more income from bonds than they could for much of the past, call it, 15 years. Something that's worked well for us in a rising rate environment are laddered bond portfolios, both municipal and corporate, generally on the short to intermediate side.

Mike Bisaro, president and CEO, StraightLine: We are almost completely avoiding the long end of the yield curve. We don't believe you're being paid enough for the risk that you're taking on the long end of the curve, and the risk of principal loss is still elevated, in our opinion. The Treasury is trying, through semi-artificial measures, to buy on the long end of the curve and keep those yields down. But we don't see that trend having a ton of legs. We think the risks that are out there, with the national debt now at $40 trillion, with inflation still stubborn and probably not going anywhere, with the budget questions, energy prices, concerns about the wars.

It's hard to imagine a scenario where investors are going to be OK receiving less yield in the face of all that uncertainty. Bonds and stocks are now positively correlated: They're moving together in many ways. I think the best case scenario is that yields stay stable, but it's very possible that the principal comes down as investors demand more yield. So we're using shorter-term bonds for stability and some income, better than what you're getting in the bank.

Joshua Barone, financial advisor, Savvy Wealth: The situation is more complex than it typically has been in the past. Historically if you saw interest rates spiking, with the economy still doing well and a hawkish Fed, you would think monetary easing would be coming. But we don't see it that way. I think people are starting to worry about the speed with which the government is adding to the national debt. So it's not just an inflation problem, it's an issuance problem as well.

The bottom line for retail bond investors: You don't want to play the back end of the curve quite yet, so stay mid to moderate on the curve. And stick to high quality. You don't want to be in high yield because the spreads are too tight. Short, extremely high-quality bonds are where you want to be right now. And that's predominantly U.S. You don't want to be in foreign claims because there is some view that the hawkish Fed will create a stronger dollar.

Katherine Gallagher, co-head of U.S. equities, Procyon: Our view for bonds in the near term is challenging. The correlation between bonds and stocks has been increasing over the past year or so-it's north of .5 now [reducing the diversification benefits of owning both stocks and bonds]. That's challenging the role of bonds in the portfolio. It's driven by the fact that valuations are stretched for some stocks. For investors who have a lot of growth stocks that have done well over the past couple of years, those are tied to yields more than the broader market is.

While that paints a not-great picture, the important thing to remember is that the range of outcomes for bonds is much narrower than for stocks. Even though you may see losses in your bond portion of your balanced portfolio, it's still going to be a lot narrower than for equities, and that shouldn't be an issue for long-term goals. But for clients who have short-term liquidity needs, we're moving them more into money-market funds where we can. Yields there are about 3.5%, and it's much more stable.

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