Financials

According to the White House Council of Economic Advisers, “Student debt is less likely to make a recession more severe or slow an expansion in the way that mortgage debt may have.”

Yields on bonds don’t remain constant. When they change by the same magnitude across maturities, we call the change a “parallel shift.”

In normal conditions, the yield curve is upward-sloping. As bonds pay only interest (the coupon) until maturity and pay face value at maturity, investors take longer to recover their principal.

This article considers the prospects for further real GDP growth acceleration and the implications for Japanese exporters like Toyota.

If you’re a bond (BSV) (AGG) investor or fund manager, fluctuation in interest rates is one of the key risk drivers for the returns you get from your portfolio.

This article considers the growing wage level in China and its effect on Baidu and other Asian equities.

“Risks are asymmetric on the downside” On the economy, Ray Dalio stated that “the risks are asymmetric on the downside, because asset prices are comparatively high at the same time there’s not an ability to ease.” Courtesy of the current global monetary policy’s low interest rates, asset prices are artificially inflated—so much so that they’ve […]

The “three big forces” Ray Dalio believes that “three big forces” drive all economies. These are: productivity growth the short-term debt cycle the long-term debt cycle An economy has to go through upturns and downturns Central bankers need to study the determinants of productivity for their economy. The determinants could include the costs of education, […]

The higher the expense ratio, the deeper the decline in an investment’s value. Also, the higher the period of investment, the greater the impact of expense ratios due to the compounding effect.

Owning an ETF comes with some fees. These fees are called “expense ratios” because they’re expressed as a percentage of a fund’s assets.

Other than the operating costs of an ETF, the other hidden cost that affects the return for investors is the bid-ask spread.

To see how expense ratios can affect investments over time, let’s compare the returns of several fixed income ETFs that differ only in expense ratio.

We note that net or effective returns (that is, returns after expenses) fall to 7.95% versus perceived returns of 8.44% for TLT for the past three years.

Inflation is moving up towards its target, but it still has a ways to go before it gets there. Paul Krugman believes raising rates could keep inflation from reaching that target.

Trade has been a key focus with respect to the US elections lately.

Investors can take an informed decision by knowing the rate of return on their investment.

Most of the deals last week were in the tight ends of the talk, indicating higher demand for high yield bonds (JNK). The higher demand in turn pushes yields down.

Boardwalk Pipeline Partners (BWP) is a master limited partnership that provides transportation, storage, gathering, and processing services for natural gas and natural gas liquids.

In practice, asset owners (both retail and institutional) want to avoid significant portfolio drawdowns even if the benchmark index declines.

Portfolio durations differ from key rate durations, as even though the durations of two portfolios may match, both portfolios may differ in the maturity profiles of the bonds they comprise, which will result in differing key rate durations.

International bond funds like the Vanguard Total International Bond Index ETF (BNDX) can have various investment styles determined by their stated choice of bond investments.

In today’s Get Real, we took a closer look at Uber’s trouble and an unexpected boost for Canopy Growth while markets react to more unrest.

The Bullish Abandoned Baby candlestick pattern is a reversal pattern. The pattern has three candles. It forms at the bottom of a trend. In this pattern, the first candle is any long and bearish candle.

FRNs are usually issued in capital markets, whereas leveraged loans are arranged by commercial and investment banks. While FRNs are typically unsecured and investment-grade, leveraged loans are secured.

U.S. Bank’s (USB) non-performing assets were $1,808 million at the end of 4Q14. The ratio declined by 11.24%—compared to 4Q13.

Technical analysis is used to forecast stocks. All of the technical indicators give possible entry and exit points. The forecasting accuracy isn’t 100%. This is one of disadvantages of technical analysis.

A company managing higher risk products must maintain a higher level of minimum capital compared to a company with a relatively lower level of risk.

Private equity is capital invested in companies that aren’t listed on stock exchanges. These alternative assets include venture capital.

Some players are present across the spectrum of alternative assets, but most alternative asset managers are present only in a particular asset area.

A cap was put in place to stop the currency’s appreciation. An appreciating local currency is detrimental to exporters.

Net interest income contributes about half of Bank of America’s total income. Investment and brokerage services contribute the most to noninterest income.

Bank of America operates through five major segments. Its Consumer and Business Banking segment contributes a third of the bank’s total revenues.

Bank of America Corporation’s (BAC) banking operations are the second-largest in the United States by assets.

Consumer and Business Banking is Bank of America Corporation’s (BAC) largest segment. It contributes about a third of the bank’s total revenues.

Credit card loans account for more than half of Bank of America’s total consumer loan portfolio.

In addition to assessing the credit profile of the borrower, Bank of America ensures that loans aren’t too concentrated by industry, geography, or customer.

Bank of America’s (BAC) Global Markets segment offers sales and trading services across asset classes to institutional clients.

You need to understand loan categories better in order to see some very interesting trends in U.S. Bank’s loan growth. Its loans are divided into five main categories.

Ford (F) uses a high amount of financial leverage. Its debt-to-capital ratio is 81.1%. This is significantly above the industry average of 53.1%.

The auto industry has lower margins primarily because of intense competition. It makes it difficult for companies to pass on increases in raw material prices to the customer.