Securities

After expressing his thoughts on the Baby Boomer generation’s having become risk-averse, Richard Bernstein moved on to the topic of the safety of “safe” investments.

The expected occurred on November 2, 2016, when the FOMC (Federal Open Market Committee) left the federal funds rate unchanged at 0.25%–0.5%.

ECB chief Mario Draghi had nothing to say about either tapering or extension of the bond buying program.

Retracting monetary accommodation on time is crucial as well. This was the chief reason why three dissents took place in the September FOMC.

When we talk about the relationship between the US dollar and bonds and how currency movements impact bonds, we’re essentially talking about international bonds.

The balance of countries in Asia present more interesting opportunities. To better focus our discussion, I’ll concentrate on investment grade markets.

In this series, we’ll compare yields across various developed markets (EFA) (VEA). We’ll also look at how a steepening yield curve affects the financial sector (XLF).

The Fed’s Shifting Stance on Rates The summer doldrums came late this year for gold and gold stocks. Now that the U.K. Brexit decision is old news, the markets are again obsessed with the Federal Reserve’s (the “Fed”) shifting stance on rate decisions. Although the Fed’s tone had been dovish on rate increases following the […]

The UK has taken over other countries as the most sought-after bond market destination, especially after the Brexit vote.

Moving on to the fixed income space, the Janus team sees holding duration in portfolios as a risk.

In this series, we’ll look at the Janus Asset Allocation team’s views on inflation, policy measures, and asset allocation (ITOT) (NEAR), given its assertion that inflation pressures are building.

Microsoft (MSFT) issued Aaa/AAA rated high-grade bonds worth $19.8 billion through seven parts on August 1, 2016.

Lately, mortgage rates and bond yields have shown a weak correlation. Treasury yields have fallen in the past month, while mortgage rates have been steady.

The reason for low yields lies outside the United States. Global yields have been heading south over the last ten years.

Lately, mortgage rates and bond yields have shown a weak correlation. Treasury yields have fallen over the past month, while mortgage rates have been steady.

Between Jan 2014 and September 2015, the break-even rate was higher than the CPI inflation rate, as markets were surprised by the sudden dip in oil (USO) prices.

The break-even rate is the difference between the yields of ten-year Treasuries (IEF) (TLH) and ten-year TIPS (VTIP).

Housing starts and building permits came in around 1.2 million—towards the top end of a narrow range over the past year.

During the 1999–2002 dot-com bubble crisis, the US 2-Year Treasury yield fell by 74%. It made a high of 6.9% in May 2000 and a low of 1.8% in September 2002.

In his July 2016 Insights newsletter, Richard Bernstein stated, “Safe investments are safe until everyone wants them.”

Historically, investment-grade and high-yield municipal bonds (MUB) have a very low correlation with most other asset classes.

Not only are European stocks cheaper than American ones, they also offer more attractive dividend yields.

The World Bank expects the pace of US economic growth to be 1.9% this year—a sharp correction from the 2.7% pace the bank projected in January 2016.

Over the years, average returns from municipal bonds (CMF) are in line with the broader index. They outperformed in some years and underperformed in others.

Municipal bonds (MUB) have provided an excellent return in the past year. The returns are even better if we account for their tax benefits.

In the 1990s and 2000s, when gold prices tracked inflation, although the correlation seems to be a bit weak compared to the 1970s and 1980s.

Since the start of 2015, the S&P 500 and real yields have had a high negative correlation. Falling real yields have encouraged investors to take more risk in search of higher returns.

In his investment outlook for June 2016, Bill Gross asserted that “carry” is compressed in nearly every form. It has more risk than return.

In his latest monthly investment outlook for June 2016, bond market veteran Bill Gross talked about “carry” in financial markets.

The recent 5.5% year-over-year gain for home prices has put the FHFA House Price Index about 3% above its April 2007 level.

The US Department of the Treasury conducted the weekly auction of four-week Treasury bills (or T-bills) on April 26.

Asset managers have warned that costs may rise. They recommend inflation-linked securities such as Treasury inflation-protected securities (or TIPS).

A population of 80 million strong in the U.S., millennials – those born between 1980 and 1999 – are breaking with tradition.

The ten-year Treasury (IEF) yield has plunged in recent weeks. It dipped from 2.3% at the start of this year to ~1.6% currently, in a risk-off trade.

Labor productivity is an important tool to measure the strength of a country’s economy. Policymakers often use this indicator to compare output efficiency during a particular period.

Interest rates are a key performance driver for life insurance companies. They affect their margins, hedging costs, and product sales.

Treasuries (TLO) add ballast to a stock-centric portfolio while providing low yields.

Higher volatility calls for you to rethink your strategy. After being calm for most of 2014, both bonds (AGG)(BND) and stocks have experienced volatility this year.

Fannie Mae TBAs started the week at 104 15/32 and gave up 7/16 to close at 104 1/32. The ten-year bond yield increased by 7 basis points.

With interest rates likely to go up by the end of the year, TIPS with shorter maturities look more attractive.