When is "junk" valuable? When there's high yield to be had, of course.
Paddy Hirsch explains this potentially riskier, potentially more rewarding end of the bond market, which has famously backed many of the biggest leveraged buyouts and aggressive M&A deals ever undertaken.
For more news, analysis, and trends on the high yield bond market check out http://www.highyieldbond.com, a free site powered by S&P Capital IQ/LCD to promote the asset class.
You can also check out http://www.leveragedloan.com for news and analysis on that market, and LCD's Leveraged Loan Market Primer/Almanac, a free guide detailing quarterly market and historical trends, as well as market mechanics. http://http://www.leveragedloan.com/primer/
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Views: 12465
LCDcomps
In this episode of common sense investing I will tell you why you should think twice about owning high yield bonds.
Alternative investments are a broad category, so I have split this topic up into multiple parts. In Part One, I will tell you why high yield bonds don’t quite yield enough to justify their risks.
My name is Ben Felix of PWL Capital and this is Common Sense Investing. I’ll be talking about a lot more common sense investing topics in this series, so subscribe and click the bell for updates. I want these videos to help you to make smarter investment decisions, so feel free to send me any topics that you would like me to cover.
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Views: 7167
Ben Felix
What do I do? Full-time independent stock market analyst and researcher:
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Check the comparative stock list table on my Stock market research platform under curriculum preview!
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Most say that a good portfolio is 60% stocks and 40% bonds and then to add on the bonds part as you age. I fully disagree because bonds are about to be a terrible investment in the future. Remember that bonds were called certificates of confiscation back in the 1970 due to constantly rising interest rates and inflation. As interest rates are at all time lows it might happen again.
I also discuss high yield bonds or junk bonds and the risk of investing in bond ETFs.
When bond yields go up, bond prices go down, it is as simple as that. Where will yields and interest rates go from now on?
Views: 3119
Invest with Sven Carlin, Ph.D.
May 28 -- Franklin Templeton Fixed Income Group Senior Vice President Eric Takaha discusses the bond markets. He speaks on “Market Makers.”
-- Subscribe to Bloomberg on YouTube: http://www.youtube.com/Bloomberg
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Views: 4192
Bloomberg
The current low interest rate environment means that bond investors have to take more risk in order to gain an attractive return on their invested money. The current low interest rates also present a risk that if interest rates and inflation rise in the future, then bond prices may fall and portfolios could suffer losses.
Views: 7730
hubbis
In this revision video we work through some numerical examples of the inverse relationship between the market price of fixed-interest government bonds and the yields on those bonds.
Government bonds are fixed interest securities. This means that a bond pays a fixed annual interest – this is known as the coupon
The coupon (paid in £s, $s, Euros etc.) is fixed but the yield on a bond will vary
The yield is effectively the interest rate on a bond. The yield will vary inversely with the market price of a bond
1.When bond prices are rising, the yield will fall
2.When bond prices are falling, the yield will rise
- - - - - - - - -
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tutor2u
2017 was a solid year for high yield. Andrew Susser, head of the corporate bond team at MacKay Shields, takes a look at what's ahead in 2018.
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Views: 772
New York Life Investments
With low Treasury yields, the BlackRock CIO of Fixed Income says asset-backed securities are one place to look for higher yields
Views: 7751
CNN Business
NatAlliance Securities global fixed income head Andy Brenner and Palisade Capital Management CIO Dan Veru on why U.S. government bond yields are beginning to rise and the benefits of convertible securities.
Views: 1506
Fox Business
The Gartman Letter editor Dennis Gartman discusses the wild market swings on Wall Street.
Views: 4491
Fox Business
Robert Smith, chief investment officer at Sage Advisory, explains
how he has positioned clients for the next Fed move, and how he picks
exchange traded funds.
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Wall Street Journal
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KEY POINTS
1. Bond prices and bond yields move in opposite directions. When bond prices go up, that means yields are going down; when bond prices go down, this means yields are going up. Mathematically, this is because yield is equal to:
annual coupon payments/price paid for bond
A decrease in price is thus a decrease in the denominator of the equation, which in turn results in a larger number.
2. Conceptually, the reason for why a decrease in bond price results in an increase bond yields can be understood through an example.
a. Suppose a corporation issues a bond to a bondholder for $100, and with a promise of $5 in coupon payments per year. This bond thus has a yield of 5%. ($5/$100 = 5%)
b. Suppose the same corporation then issues additional bonds, also for $100 but this time promising $6 in coupon payments for year -- and thus yielding 6%.
No rational investor would choose the old bond; instead, they would all purchase the new bond, because it yielded more and was at the same price. As a result, if a holder of the old bonds needed to sell them, he/she would need to do so at a lower price. For instance, if holder of the old bonds was willing to sell it at $83.33, than any prospective buyer would get a bond that earned $5 in coupon payments on an $83.33 payment -- effectively an annual yield of 6% (5/83.33). The yield to maturity could be even higher, since the bond would give the bondholder $100 upon reaching maturity.
3. The longer the duration of the bonds, the more sensitivity there is to interest rate moves. For instance, if interest rates rise in year 3 of a 30 year bond (meaning there are 27 years left until maturity) the price of the bond would fall more than if interest rates rise in year 3 of a 5 year bond. This is because an interest in interest rates reduces the relative appeal of existing coupon payments, and the more coupon payments that are remaining, the more interest rate fluctuations will impact the price of the bond.
4. Lastly, a small note on jargon: when investors or commentators say, "bonds are up," (or down) they are referring to bond prices. "Bonds are up" thus means bond prices are up and yields are down; conversely, "bonds are down" means bond prices are down and yields are up.
Views: 62600
InformedTrades
Tax-free municipal bonds is a useful tool in creating more tax free income. Buying this very special type of asset class allows the dividends you get to be tax free. If you are in a high tax bracket, then these types of bonds is ideal as compared to earning dividends on the free stock market.
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BeatTheBush
Jeff Gundlach says - Massive bond issues coming. Homebuilders already entered bear market. US stock indices and the rest of the world's diverged wildly since June. Higher rates from here will negatively impact the stocks and real estate markets. Republicans will lose the House in November.
Views: 15894
The Macro
Learn how US 10 yr Bond Yields correlate with USD/JPY and how this can trump trump USD weakness. How is EUR/JPY affected?
Views: 378
Easymarkets TraderTalk
Investors have been buying tax-free municipal bonds at a record pace this year despite historically low yields. Jim Murphy, manager of the T. Rowe Price Tax-Free High Yield Fund, discusses his strategy for earning higher tax-exempt yields and the outlook for muni bond investing. Learn more at http://trowe.com/29BGS4a
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T. Rowe Price
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Marginal Revolution University
Today I want to tell you why focusing on investing to generate income is a flawed strategy altogether, and why a total return approach to investing will lead to a more reliable outcome.
In my last two videos, I talked about high yield bonds and preferred shares. These are two alternative asset classes that investors venture into when they are seeking higher income yields. I told you why you might want to avoid those asset classes here:
Why You Should Think Twice About High Yield Bonds:
https://youtu.be/CZp9ULWi3pI
Why I Prefer to Avoid Preferred Shares:
https://youtu.be/rRlkvFVTqvM
------------------
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Views: 15028
Ben Felix
Fixed Income High Yield Money Market, CD and Short Term Bonds.
Many investors and non investors want to park their money and get the best interest rate and yield.
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Who are we? The Wisdom Investor is all about providing valuable information and education to help you accumulate a nest egg for retirement. People of all ages can benefit from our videos. We want to help you build your financial wealth. You can build your financial wealth by saving, investing and managing your expenses. In addition we cover topics like Social Security, debt, housing, expenses, withdrawing money, health care, tax strategies, exercise and where to live.
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Wisdom Investor
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Fixed income can be a critical part of nearly every well-diversified portfolio. Used correctly, fixed income can add diversification and a steady source of income to any investor’s portfolio.
But how do you choose the right fixed-income ETF?
The key to choosing the right fixed-income ETF lies in what it actually holds. U.S. bonds or international bonds? Government securities or corporate debt? Bonds that come due in two years or 20 years? Each decision determines the level of risk you’re taking and the potential return.
There are many types of risks to consider with bond investing. Let’s talk more about two in particular: Credit risk and Interest-rate risk.
Determining the level of credit risk you want to assume is an important first step when choosing a fixed-income ETF. Do you want an ETF that only holds conservative bonds—like bonds issued by the U.S. Treasury? Or do you want one holding riskier corporate debt? The latter may pay you a higher interest rate, but if the company issuing the bond goes bankrupt, you’ll lose out.
ETFs cover the full range of available credit. Look carefully at the credit quality composition of the ETFs underlying holdings, and don’t be lured in by promises of high yields unless you understand the risks.
Bonds are funny. Intuitively, you would assume that higher interest rates are good for bondholders, as they can reinvest bond income at higher prevailing interest rates. But rising interest rates may be bad news, at least in the short term.
Imagine that the government issues a 10-year bond paying an interest rate of 2%. But shortly thereafter, the U.S. Federal Reserve hikes interest rates. Now, if the government wants to issue a new 10-year bond, it has to pay 3% a year in interest.
No one is going to pay the same amount for the 2% bond as the 3% bond; instead, the price of the 2% bond will have to fall to make its yield as attractive as the new, higher-yielding security. That’s how bonds work, like a seesaw: As yields rise, prices fall and vice versa.
Another important measure to consider when looking at interest rate risk is duration which helps to approximate the degree of price sensitivity of a bond to changes in interest rates.
The longer the duration, the more any change in interest rates will affect your investment. Conversely, the shorter the duration, the less any change in interest rates will affect your investment.
Let’s review a few other considerations when looking at fixed income ETFs.
First, expense ratios: Because your expected return in a bond ETF is lower than in most stock ETFs, expenses take on extra importance. Generally speaking, the lower the fees, the better.
Second, tracking difference: It can be harder to run a bond index fund than an equity fund, so you may see significant variation between the fund’s performance and the index’s returns. Try to seek out funds with low levels of tracking difference, meaning they track their index well.
Finally, some bonds can be illiquid. As a result, it’s extra important to look out for bond ETFs with good trading volumes and tight spreads.
There are other factors to watch for too, but these are the basics. ETFs can be a great tool for accessing the bond space, but as with anything, it pays to know what you’re buying before you make the leap.
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Views: 57237
Fidelity Investments
The Federal Reserve has been raising interest rates for the past couple of years. It looks like they’re signaling that they’re going to continue to raise them over the next year or so, and yet what we’ve seen recently is that longer-term treasury bond yields haven’t been rising as much. On this episode of Bond Market Today, Kathy Jones and Collin Martin discuss how high bond yields might go in this cycle.
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Views: 6894
Charles Schwab
The high-yield bond market has rallied again in recent months after a selloff that drove yields to their highest levels since 2011. The market was hit hard in 2015 and early 2016 by worries about slowing global growth and the collapse of energy priceswhich slammed the bonds of many oil and gas companies. Lately, growth fears have eased and oil prices have recouped some of their losses. But many investors remain concerned about other potential threats to high-yield, including credit tightening by the Federal Reserve, prolonged weakness in emerging-market economies and the rising tide of corporate debt maturing between 2018 and 2022. Are central bank policies, including negative interest rates in Europe, supportive or hazardous for high-yield? Which industries offer the best value prospects for investors now? On this panel, leaders in high-yield and leveraged finance will share their outlooks and strategies.
Moderator
Tom Braithwaite, Lex Writer, Financial Times
Speakers
Christopher Boyle, Managing Director and Portfolio Manager, Guggenheim Partners
Peter Budko, Partner, AR Global
Henry Chyung, Chief Investment Officer, Post Advisory Group
Robert Kricheff, Global Strategist and High-Yield Portfolio Manager, Shenkman Capital
Andrew Whittaker, Vice Chairman, Jefferies; Vice Chairman, Leucadia National Corp.
Views: 5174
Milken Institute
This video introduces the concept of Bonds. What are bonds and why are they issued. What is a bond, meaning and information of bonds in Hindi. बॉन्ड्स क्या होते है, बॉन्ड्स और बॉन्ड मार्किट की जानकारी, बॉन्ड्स का अर्थ, बॉन्ड्स ट्रेडिंग और बॉन्ड यील्ड. बॉन्ड या बॉन्ड्स (Bonds) एक प्रकार का ऋण होता है. इसे एक प्रकार का उधार पत्र भी कह सकते है. इसे आमतौर पर किसी देश की सरकार के द्वारा जारी किया जाता है.
Views: 27635
Rajiv Dharmadhikari
2018 Vanguard Long-Term Bond Fund ETF's With High Yields! Which Vanguard Bond fund should invest in? Learn about the best Vanguard dividend funds (Index Fund ETF's) Find out about the 4 top performing Vanguard Bond ETF funds available through Vanguard.
The spreadsheet in the video can be downloaded here:
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or
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Video Outline and Time Stamps so you can quickly jump to any topic:
• Vanguard Extended Duration Treasury ETF (EDV) - 1:22
• Vanguard Long-Term Bond Fund ETF (BLV) - 5:25
• Vanguard Long-Term Corporate Bond Fund ETF (VCLT) - 7:34
• Vanguard Tax Exempt Bond Fund ETF (VTEB) - 9:05
• Vanguard bond fund etf comparison - 11:38
• Bond Fund Pros and Cons (Bond Risks, etc) - 12:10
In this very detailed review you will learn about the four Vanguard Long-Term Bond Funds Etfs (Index Funds) available to invest in. The four Vanguard Long-Term Bond Funds
1.Vanguard Extended Duration Treasury ETF (EDV)
2. Vanguard Long-Term Bond Fund ETF (BLV)
3. Vanguard Long-Term Corporate Bond Fund ETF (VCLT)
4. Vanguard Tax Exempt Bond Fund ETF (VTEB)
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You should always do your own research before implementing new ideas or strategies. If you are unsure of what to do you should consider consulting with a financial adviser or tax accountant such as an Enrolled Agent, or Certified Public Accountant in the area in which you live.
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Views: 4004
Money and Life TV
CNBC's Dom Chu takes a look at high-yield ETFs bouncing back after market turmoil.
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CNBC Television
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'The End of Alchemy" by Mervyn King: https://www.amazon.co.uk/gp/product/0349140677/ref=as_li_tl?ie=UTF8&tag=maneco64-21&camp=1634&creative=6738&linkCode=as2&creativeASIN=0349140677&linkId=e2a08014f7e6a2185e1b3b02e8617498
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maneco64
Bond markets can be one of the first places to look for signs of trouble. In this short video I introduce and explain a key warning indicator – the yield spread.
Views: 6730
Killik & Co
Caleb Wong, OFI Global Portfolio Manager, explains how both cat bonds and high-yield bonds can potentially deliver substantial spreads over U.S. Treasuries in exchange for higher risk. And, like high-yield bonds, catastrophe bonds have the potential to default if the underlying asset sustains a major loss. Learn the similarities and differences between the two types of bonds: http://bit.ly/2gd6F9B
Views: 105
OppenheimerFunds
Most investors have no idea how bond or note yields affect the forex or any other capital market. This is unfortunate because they play a major role in what happens to capital flows and can be used to time and manage forex trades. 100% free forex education available from http://www.pfxglobal.com.
Views: 11320
profitingwithforex
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As bond yields slip ever lower each year, companies which can offer a high dividend have gained favour. But the FT's Alan Livsey says don’t succumb to the temptation of buying high-yielding stocks without checking that the corporates can keep up the payments.
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Views: 1622
Financial Times
In this tutorial, you’ll learn how to approximate the Yield to Maturity (YTM) of a bond, including how you might modify it to cover Yield to Call and Yield to Put as well as real-life scenarios with debt investing.
http://breakingintowallstreet.com/
"Financial Modeling Training And Career Resources For Aspiring Investment Bankers"
Table of Contents:
1:14 Part 1: The Yield to Maturity (YTM) and What It Means
5:27 Part 2: How to Quickly Approximate YTM
10:19 Part 3: How to Extend the Formula to Yield to Call and Yield to Put
13:32 Part 4: How to Use This Approximation in Real Life
16:27 Recap and Summary
Part 1: The Yield to Maturity (YTM) and What It Means
Yield to Maturity is the internal rate of return (IRR) from buying the bond at its current market price and holding it to maturity.
Assumption #1: You hold the bond until maturity.
Assumption #2: The issuer pays all the coupon and principal payments, in full, on the scheduled dates.
Assumption #3: You reinvest the coupons at the same rate.
Intuition: What’s the *average* annual interest rate % + capital gain or loss % you earn from the bond?
You can use the YIELD function to calculate this in Excel:
=YIELD(Settlement Date, Maturity Date, Coupon Rate, Bond Price % Par Value Out of the Number 100, 100, Coupon Frequency)
For example, if you buy a 5% bond for 96.23% of its par value on December 31, 2014, and hold it until its maturity on December 31, 2024, you could enter:
=YIELD(“12/31/2014”, “12/31/2024”, 5%, 96.23, 100.00, 1) = 5.500%
You could also project the cash flows from the bond and use the IRR function to calculate YTM, but this will work only for annual periods and annual coupons.
Part 2: How to Quickly Approximate YTM
Approximate YTM = (Annual Interest + (Par Value – Bond Price) / # Years to Maturity) / (Par Value + Bond Price) / 2
Intuition: Each year, you earn interest PLUS an annualized gain on the bond price if it’s purchased at a discount (or a loss if it’s purchased at a premium).
And you earn that amount on the “average” between the initial bond price and the amount you get back upon maturity.
For example, on a 10-year $1,000 bond with a price of $900 and coupon of 5%:
Annual Interest = 5% * $1,000 = $50
Par Value – Bond Price = $1,000 – $900 = $100
(Par Value + Bond Price) / 2 = ($1,000 + $900) / 2 = $950
Approximate YTM = ($50 + $100 / 10) / $950 = $60 / $950 = ~6.3%
There are a few limitations: the approximation doesn’t work as well with big discounts or premiums to par value, nor does it work as well with different settlement and maturity days. It also will not handle floating interest rates since it assumes a fixed coupon.
Part 3: How to Extend the Formula to Yield to Call and Yield to Put
Call options on bonds let companies redeem a bond early when interest rates have fallen, or its credit rating has improved, meaning it can refinance at a lower rate.
Usually, the company has to pay a premium to par value to call the bond early.
Put options are the opposite, and let investors force early redemption (usually when interest rates have risen, or the company’s credit rating has fallen).
Approximate Yield to Call or Yield to Put = (Annual Interest + (Redemption Price – Bond Price) / # Years to Maturity) / ((Redemption Price + Bond Price) / 2)
For example, to calculate the Yield to Call on a 10-year $1,000 bond with a price of $900, coupon of 5%, and a call date 3 years from now at a redemption price of 103:
Approximate YTC = ($50 + ($1,030 – $900) / 3) / (($1,030 + $900) / 2)
Approximate YTC = ($50 + $43) / $965 = $93 /$965 = ~9.7%, which you can estimate as “just under 10%”
Part 4: How to Use This Approximation in Real Life
Example: You’re at a credit fund that targets a 10% IRR on investments in high-yield debt.
JC Penney has a 4-year 7.950% bond that’s currently trading at 91.75 (as in, 91.75% of par value).
This seems like an easy “yes”: you get around 8% interest per year + an 8% discount / 4, and ~10% / average price of 96% results in a yield just above 10%.
BUT will a distressed company be able to repay the bond principal upon maturity? What if its financial situation worsens?
You estimate that in the best-case scenario, you’ll get 65% of the principal back upon maturity (65% “recovery percentage”). The recovery percentage will be 47% and 13% in more pessimistic cases.
Scenario 1 Approximate YTM: (8% – 27% / 4) / 78.5% = 1.6%
Scenario 2 Approximate YTM: (8% – 45% / 4) / 69.5% = -4.7%
So this is almost certainly a “No Invest” decision if these recovery percentages are accurate – even in the Upside Case, we’re far below 10%.
RESOURCES:
https://youtube-breakingintowallstreet-com.s3.amazonaws.com/Yield-to-Maturity-Formula-Slides.pdf
https://youtube-breakingintowallstreet-com.s3.amazonaws.com/Yield-to-Maturity-Formula.xlsx
Views: 15398
Mergers & Inquisitions / Breaking Into Wall Street
Mutual Funds and Bond Yields have a correlation with each other. Increase in bond yields results in an increase in interest rates. It is either a result of or results in REPO Rate by RBI. Therefore, bond price decrease and in such a scenario, Short term debt funds deliver best returns.
On the contrary, If the bond yield decrease as a result of the cut in Repo Rate, the bond price increase. It leads to higher returns from long term debt mutual funds.
An investor can take advantage of this correlation between Mutual Funds and Bond Yields. When the interest rates are increasing, Short term debt mutual funds should be preferred and in case interest rates are decreasing, Long term debt mutual funds deliver superior returns.
By investing in debt mutual funds, an investor can generate returns higher than the traditional investment options like fixed deposits or small savings schemes. The only catch is to understand the interest rate cycle to decide on the type of debt mutual fund.
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Nitin Bhatia
A default wave will soon be hitting high yield bonds and investors better be prepared for it, says Steve Blumenthal, CEO of CMG Capital. Still, Blumenthal says there is a bright side to the coming washout in junk bonds. 'The good news is that the selloff will create one of the greatest buying opportunities of a lifetime in the not too distant future. Remember the 20% yields on high yield bonds in 2008? My two cents is that the coming opportunity will be even better,' says Blumenthal. Blumenthal says tactical trend analysis enables investors to identify the primary movements in high yield bonds. His strategy is to stay invested during the up trending cycles and shorten maturities when the trend turns down. In other words, buy the iShares iBoxx High Yield Corporate Bond ETF (HYG) or the SPDR Barclays High Yield Bond ETF (JNK) when trends are turning up.
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Views: 1823
TheStreet: Investing Strategies
In this report the early market action from London on Wednesday, April 25th, 2018. I look at the precious metals, the stock market, the dollar and the bond markets.
I also talk about how a break above the 3% yield level for the 10-year note U.S. treasury would mark the probable end of the 30-year plus environment of decreasing interest rates and easy money.
I note that since 1981, when the 10-year yield topped near 16%, the U.S. economy and government have been able to take on an exponential amount of debt and credit because of a favorable interest rate environment.
My conclusion is that we could be at the very beginning of the unwind of the massive debt bubble that has been built since the early 1980s.
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maneco64
Investors should not aggressively chase high yields in places like emerging market fixed income funds or junk bonds because they could lose big on the principal, said Collin Martin, Director of Fixed Income Strategy at the Schwab Center for Financial Research. Martin added that high yield bonds have an important place in a portfolio, but investors should remember that they have a high correlation to equities. He said municipal bonds are attractive now because the states and municipalities are improving their balance sheets. Finally, Martin said he is most bullish on intermediate term bonds at this point.
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Views: 79
TheStreet: Investing Strategies
Jack Hough and Jack Otter of Barron's discuss hospital-related municipal bonds with juicy yields.
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Views: 1011
Wall Street Journal
Question: Are High Yield Bonds A Good Investment?
Views: 255
RWM INC
Keep an eye on the high yield bond market. In recent months, the rally in high yield bond prices have pushed yields lower, close to levels not seen since the 2008 financial crisis.
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Rally In High Yield Bond Prices Pushed Yields Lower, Investors' Warning | Trading Nation | CNBC
Views: 425
CNBC
Discussing the current state of the markets with Barbara Doran, BD8 Capital Partners, Steve Grasso of Stuart Frankel; and CNBC’s Rick Santelli.
Views: 1787
CNBC Television
This video explains the relationship between inflation and interest rates along with bond prices and rates. This video explains inflation and its effect on interest earned by investors. यह विडियो महंगाई दर और इंटरेस्ट रेट के बीच के सम्बन्ध को समझाता है, की किस प्रकार से महंगाई दर के बढ़ने और घटने का असर इंटरेस्ट रेट आदि पर पड़ता है.
Views: 8873
Rajiv Dharmadhikari
After a prolonged bond bull market, and in the face of rising interest rates, investors are searching for ways to generate income and shield against interest rate-driven price volatility. Watch Eric Gold, Senior Portfolio Manager, address key investor questions about US high yield markets and how the Fund aims to deliver income and provide a buffer in the face of rising rates.
Views: 201
CANDRIAM
Dennis McCarthy - (213) 222-8260 - [email protected] - capitalmarketalerts.com - New high yield bonds are now being issued at interest rates that don't really qualify as high.
Forbes magazine reports that the 30-day average high yield new issue bond yield fell to 6.11% at the end of January.
If your company has debt outstanding in an amount of $100 million or more, your company should consider issuing high yield bonds at these historically low rates.
Many companies continue to borrow at short-term floating rates because those rates are amazingly low. Most likely, short-term floating rates won't stay this low for 5 to 10 years, however.
In contrast, today's high yield bond rates present an opportunity to lock in low rates for a long period.
Also, short-term floating rate debt typically carries covenants that restrict a company.
Again, in contrast, high yield bonds typically have very few covenants restricting the issuer.
Please contact me to discuss raising high yield bonds or any capital market transaction.
Forbes article link: http://www.forbes.com/sites/spleverage/2013/01/22/high-yield-bond-yields-hit-record-low-6-11/
Views: 141
Dennis McCarthy
This video discusses the advantages of investing in municipal bonds: namely, the historically lower risk of default (relative to corporate bonds) and tax-exempt nature of most municipal bonds. The video provides an example to show how the after-tax return of a municipal bond can be higher than a corporate bond that has a higher pretax yield. The video also demonstrates why municipal bonds are more attractive to high-income investors by showing that the tax-equivalent yield of a municipal bond increases as a person's tax rate increases.
Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com
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Views: 8123
Edspira
-- http://www.GoldsteinOnGelt.com
Doug meets Daniel Rudnitsky, portfolio manager and vice-president of product development at SMH Capital Advisors. Find out what fixed income and is and the different kinds of bonds out there. What do you need to think about when choosing a bond for your portfolio?
"Goldstein on Gelt" is a global investment and financial planning radio show designed to educate and entertain its listeners with financial strategies and investment tips. Investment advisor Douglas Goldstein hosts the weekly show and is the director of Profile Investment Services, Ltd., www.profile-financial.com.
Views: 388
Douglas Goldstein
In this interview with CNBC-TV18, Neeraj Gambhir, MD and Head of Fixed Income at Nomura India gave his outlook on the road ahead for the bond market.
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CNBC-TV18 is India's No.1 Business medium and the undisputed leader in business news. The channel's benchmark coverage extends from corporate news, financial markets coverage, expert perspective on investing and management to industry verticals and beyond. CNBC-TV18 has been constantly innovating with new genres of programming that helps make business more relevant to different constituencies across India. India's most able business audience consumes CNBC-TV18 for their information & investing needs. This audience is highly diversified at one level comprising of key groups such as business leaders, professionals, retail investors, brokers and traders, intermediaries, self-employed professionals, High Net Worth individuals, students and even homemakers but shares a distinct commonality in terms of their spirit of enterprise.
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Views: 543
CNBC-TV18
Description
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FirstAssetFunds
Bond Yields are an important part of the financial markets. They have been a strong focus recently for Shaun Richards, from Not A Yes Man Economics. If you look at the beginning of the credit crunch, Central Banks thought that at first they could deal with it by cutting short term interest rates. That did not work and it did not get the response that they had initially expected. After this point they considered other interest rates, at the time the thought was that the short term interest rate was the solution to all problems.
After this gamble, they moved to longer term interest rates. This meant that they could influence what businesses pay, mortgage rates. In essence the beginning of Quantitative Easing. This is the lead in to the current issues. We have had flares of bond yields increasing in the face of crises in Europe. However now, everywhere you look yields are low. This goes counter to what economics suggests should be happening. Yields should be picking up higher. They are often forecast to move higher, however it never happens.
After the election of Trump bond yields did go higher. But if you look across a flat yield the gap between the start at end is very little. The 2YR yield is 1.8%, the 30YR is 2.71%. So if that market is correct, it is in fact telling us that there is not much to expect for the next 30 years! There is a further element to that, it would historically mean that a recession was on its way. What it does mean is that the Central Banks have levelled the market.
Whilst Bond Yields are in the control of Central Banks, then they will not rise much. There will be fluctuations, but they will stay in a tight range. With yields so low, it has in fact saved governments a lot of money. To see a real move now would require a very big crisis. We would need a new credit crunch to ever see yields move higher.
Shaun then discusses the possibility of Central Banks wanting to steepen the curve and how they would go around that. Finally they then look at the effect of yields on the man on the street; whether it be mortgage rates, pension rates.
Core Finance is part of Core London, a TV production company based in Belgravia, London. Core Finance aims to provide its viewers with insightful market commentary, helping investors navigate global financial markets. Making the content provided invaluable to viewers.
Our shows are closely followed by fund managers, day traders, retail investors, company CEO's, experienced investors and those new to the financial markets.
Core Finance covers all asset classes ranging from currencies (forex), equities, bonds, commodities, crypto-currencies, ETF's, futures and options.
Views expressed are solely those of guests and presenters and do not constitute investment advice and are not the views of Core Finance or Core London.
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Views: 170
Core Finance
Street Diligence enables investment professionals to rapidly evaluate and analyze complex high yield bonds, bank loans, and other related securities by transforming the tedious and cumbersome due diligence process into an efficient, accurate, alpha-generation tool. Our web-based platform is more than a system to streamline due diligence; it is a targeted analytics tool created by former hedge fund PMs and analysts that provides unique access to data and metrics normally scattered across platforms, hidden in an assortment of documents, or obscured by legal jargon. We provide unique views of covenant constraints across the capital structure and corporate tree, composite and redline functionality incorporating all amendments and supplements into one master document, and side-by-side comparison tools for trend and issue-spotting. Street Diligence was founded in 2012, and our platform is used by many of today’s leading credit-focused hedge funds, asset managers and investment banks.
Views: 1409
Street Diligence, Inc
We review a high-income exchange traded fund, discussing its attributes, its risks and how to find its current yield. We discuss how using short-term bonds and a currency hedge reduces the volatility of this fund.
Views: 518
PensionCraft