Amid the many strategies proposed to overcome Labor’s franking policy if adopted, often overlooked is building a portfolio of the right types of bonds and hybrids as an alternative source of income.
Tag Archives | bonds
The US inverted yield curve has many worried about whether it indicates a coming recession, but the Fed has moved to a more dovish stance. A diversity of equity and bond exposures is the best way to cope.
Nobody revalues their own home each day in the way they revalue listed equities, but does that mean the value is constant? The daily unit price is calculated in some super funds using unlisted asset valuations.
We like a good debate, and when two opposing views argued about the role of government bonds in a diversified portfolio, a veteran of 30 years in fixed interest stepped in as referee.
Bond investing is not only buy and hold and traditional return sources such as income, changing yields and duration. Relative value identifies market inefficiencies and uses risk management techniques in all market conditions.
While property and equity markets remain expensive by historical standards, yields achievable relative to risk remain strong in the hybrid market, notwithstanding recent upticks in price.
The major global bond index currently offers a yield of only 1.6% at a time when a rising rate cycle may be starting. There are better risk-return opportunities elsewhere.
Exposure to bonds in the last few decades has delivered strong returns, but the risks in simply buying a bond index are acute and investors should consider different ways of investing in bonds.
The reality of investing in a bond is that regardless of whether we have experienced a massive bull market, the most a bond is worth at maturity is the face value.
The yield quoted for a bond can be calculated in many different ways, depending on its characteristics or the investment horizon of the bond holder. Which yield are you buying?
After some poor experiences during the GFC, hedge funds offering uncorrelated returns have greater appeal as traditional markets struggle, but don’t pay up for simple market exposure.
Despite the global bond duration index nudging an historic peak of 7 years, portfolios can still benefit from holding exposure to fixed interest investments as long as investors are aware of the impact of duration.
A counter-view on why bond yields are so low, and how the market can still use and interpret what bonds are telling us. Plus Roger responds that different opinions make a market, and that’s good.
In previous cycles, bond yields provided a strong indication of the general health of the economy, but huge coordinated actions by central banks are changing that paradigm. Watch how you read the signals.
The market has seen a major widening of credit spreads as investors demand greater compensation for liquidity risk. Has the market reached the point where it offers value?
The best end-of-year wrap of asset class performance in 2015. Aussie equities was a loser but who were the winners, and what’s the outlook for each asset class in 2016?