SPDR® Barclays Short Term Hi Yld Bd ETF
EM Corporates Offer Huge Opportunities and Better Profile
VanEck A Diverse and Growing Category The emerging markets high yield bond market has grown tremendously over the past 10 years, from $56 billion at the end of 2007 to $440 billion as of June 30, 2017.[2. Source: BofA Merrill Lynch.] In addition to growing in size, diversity within the category has also increased. Investors currently […]
Investment Avenues during the Rise of Short-Term Interest Rates
Bill Gross thinks the central banks should implement their strategies very carefully and cautiously in this scenario.
Will Fallen Angel Bonds Continue to Capture Solid Returns?
VanEck How fallen angels may complement high yield portfolios Income investors may want to consider fallen angels as a complement to their high yield bond allocations given their higher credit quality. Fallen angels’ higher average credit quality than original-issue high yield bonds may help absorb more of the potential broader market volatility that may occur […]
Why the FOMC Statement Didn’t Affect Equity Markets
Since the previous Fed meeting in March, where the Fed announced a 0.25% rate hike, equity markets (IWV) around the globe remained dovish.
Bill Gross and High-Yield Bonds: Priced for Too Much Growth
Investors generally invest in high-yield bonds (BND) when there are expectations for higher growth in the economy.
What Do Fed Officials Have to Say after the March Meeting Minutes?
Markets will be monitoring any comments from the Fed going forward, and every future meeting will likely be lively in terms of the possibility of another rate hike.
Why High Yield Bonds Are an Effective Match with Equities
AB Keeping Pace with Equity Returns over Time In fact, when we widen the lens to take in the last three decades, high-yield bonds have nearly matched equity performance. And they’ve done it with much lower volatility. Since July 1983, stocks have produced an annualized return of 10.9% (Display 1). High-yield bonds have nearly equaled […]
Why High-Yield Bonds Are Needed in a Portfolio
AB Summing It Up High-yield bonds present an alternative for investors at an uncertain crossroads. Equity valuations seem attractive based on some measures, but volatility has led many investors to search for ways to temper the risk in their portfolios. At the same time, bonds—a popular risk reducer—are less attractive than normal due to extremely […]
What Role Do High Yield Bonds Play in a Portfolio?
AB High Yield in the Portfolio Framework Given their higher risk levels, we’d expect that stocks would continue to outperform high yield over the long run. However, high-yield bonds have clearly demonstrated that they bring much to the table if they’re combined with stocks in a carefully designed and maintained portfolio. But not every investor […]
How Portfolio Rebalancing Boosts Overall Returns
AB Rebalancing in the Tails Because stocks have been so much more volatile than high yield, periodic portfolio rebalancing tends to occur during performance extremes—the “tails” in return distributions—when the gap between high-yield and equity returns is wide. This magnifies the “buy-low, sell-high” effect that rebalancing contributes to a portfolio’s performance. Of course, the gaps […]
How High-Yield Bonds Can Help Reduce Risk
AB A Place at the Asset-Allocation Table For investors seeking to control volatility in their equity portfolios while still maintaining return potential, high-yield bonds could represent an effective solution. A typical approach to moderating equity volatility is to reallocate assets to the greater stability of investment-grade bonds, or even cash. But this can exact a […]
Why High Yield Bonds Are Attractive
In this series, we’ll discuss the many advantages of high yield bonds, their correlation with other asset classes, the rise of global high yield markets, and why high yield bonds should command a place in a portfolio.
Gold and Gold Miners: Analyzing Recent Performance
Gold bullion ended September at $1,315.75 per ounce for a 0.5% gain while gold stocks experienced more positive returns. The NYSE Arca Gold Miners Index[1. NYSE Arca Gold Miners Index (GDMNTR) is a modified market capitalization-weighted index comprised of publicly traded companies involved primarily in the mining for gold] (GDMNTR) posted a 3.8% gain, while […]
High-Yield Bonds Are Turning Out to Be the Real Winners
High-yield bonds gained popularity due to higher yields compared to Treasury bonds, whose yields were being pushed down by the Fed’s interest rate policy.
Company & Industry Overviews
How Holding Duration Is Risky during Rising Inflation
Moving on to the fixed income space, the Janus team sees holding duration in portfolios as a risk.
Company & Industry Overviews
Bill Gross Analyzed ‘Carry’ in Credit Risk, Volatility, and Liquidity
In his June 2016 investment outlook, Bill Gross stated that “credit risk or credit ‘carry’ offers little reward relative to potential losses.”
Why Rising Credit Spreads Point to a Slowing Economy
The difference between the yields on corporate bonds and Treasury bonds of the same maturities is often known as the “credit spread.”
How INC Can Help Balance a Fixed-Income Portfolio
The correlation between the S&P 500 Index and Treasuries has been -0.55 over the last five years.
Company & Industry Overviews
BlackRock’s iShares and retail are generating higher base fees
BlackRock has been able to generate higher base fees with the combination of performing funds and more offerings in the iShares and retail segment.
Use caution when investing with a barbell fixed income strategy
You’ll find that the principal appreciation from falling rates at the long end (IEF)(VCLT) may make up for a large part of the shortfall in yields at the short end (SJNK).
Barbell bond strategies can be more than a balancing act
A barbell strategy aims to reduce the volatility in portfolio returns while maximizing risk-adjusted returns. Let’s see how this strategy achieves these goals.
Barbell bond strategies explained: Benefits from longer tenors
There’s an obvious benefit to investing in long-term tenors. Long-term (IEF)(VCLT) maturities typically yield more than shorter-term (SHY) maturities.
Overview: The secondary market trends in high-yield bond ETFs
High-yield debt mutual funds recorded a net outflow of $198 million in the week ended September 5. This was the first net outflow in four weeks. High-yield bond funds had recorded net inflows of $672 million in the previous week.
Tech & Comm Services
Overview: Current junk-rated debt and leveraged loans situation
Bond investors have options when it comes to structuring their fixed income portfolios. They may invest in debt that’s rated investment-grade or non-investment grade (or junk-rated).
Why high yield fund flows stayed positive 6 weeks in a row
High yield bond flows last week posted the straight sixth week of positive inflows, though the pace was lower than the previous week.
Must-know: Why expense ratios have affected TLT and MUB
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.
Tech & Comm Services
Exposure to junk bonds: How much should you hedge?
Junk bonds are high yield bonds issued by below–investment grade corporations. Due to the low ratings and high risk of default attached to these bonds, they’re popularly called “junk bonds.”
High yield issuance closes May with a nose-dive!
After three relatively strong weeks, issuance fell to the lowest weekly value of the year. Issuance is important as a gauge of the market for two reasons: corporations prefer issuing when they feel the market is strong and new issues trigger a relative repricing of existing bonds in the market. Only eight deals printed last […]