Bonds are at the beginning of a long-term correction despite the strong performance of Treasuries in the first half of 2014, said Leo Kelly III, CEO of Kelly Wealth Management at HighTower. Kelly said investors should avoid bonds in favor of other assets that mitigate interest rate risk in the face of rising rates. Instead of REITs, he recommends private real estate plays such as student housing, medical facilities and public storage. Kelly is also bullish on the energy sector considering the geopolitical unrest in the world. Finally, Kelly is positive on dividend paying stocks as long as they are high quality.