Things are looking up for bonds - learn what makes them a great addition to your portfolio right now.
Here we are, another calendar quarter down with one more to go in 2024, and investors have yet to see a “hard landing” emerge.
To understand the wave of bank partnerships with private-credit fund managers during the past year or so, think back to the boom in mortgage lending through securitization in the early 2000s. The same forces are at work: a huge demand for finance, limited and costly bank capital and investment bankers’ ingenuity and desire to generate business.
Volatile interest rates have spurred investment capital into motion. Clients often ask where they should allocate on the yield curve.
The FOMC lowered the Fed Funds rate by 50 basis points at their September meeting. This was the first cut in over four years and the start of what is expected to be a multi-year easing cycle.
It's important to stay informed regarding the latest updates to 529 college savings plans, for both current account holders and prospective savers. In recent years there have been significant changes, including The Setting Every Community Up for Retirement Enhancement (SECURE) 2.0 Act in December of 2022, which helps enhance the flexibility and benefits of 529 plans.
The tendency to blindly follow these rules has led investors towards prematurely de-risking and over-estimating the likelihood of recession.
Fed easing cycles and lowered target interest rates impact various economic sectors, such as mortgages, consumer credit and cash investments.
One of most dangerous habits of a speculative crowd is the tendency to use unconditional averages and unconditional probabilities regardless of how extreme market conditions have become. This is like stepping into a house with two rooms, one with the temperature at 0 degrees and one at 140 degrees, and expecting a temperature of 70 either way.
Turbulent market conditions can make anyone nervous. Here's what investors should know about dealing with them.
Cash strategies may seem safe, but inflation can bite into returns. Instead, investors can try to outperform inflation with equities.
U.S. stocks have handily outperformed their global peers over the past few decades, as well as in the post-World War II period. We document the scale of the outperformance and ask whether it can continue.
Everything I’ve learned and experienced in 50+ years of watching the economy tells me not to expect a soft landing. But maybe that’s because I’ve never actually seen one.
As the Fed shifts its stance, investors must now weigh the broader economic implications.
After the Fed's 50-basis-point rate cut, big banks kick off earnings season amid fears that lower rates could hurt the net-interest income that propelled growth the last two years.
We are currently in the “everything market.” It doesn’t matter what you have probably invested in; it is currently increasing in value. However, it isn’t likely for the reasons you think. A recent Marketwatch interview with the always bullish Jim Paulson got his reasoning for the rally.
We expect bond yields to trend gradually lower—but it may be a bumpy ride. These seven strategies may help investors take advantage.
We believe municipal bonds currently offer a compelling balance of risk and reward for investors in higher tax brackets.
While agency mortgage-backed securities offer compelling valuations, not every mortgage is created equally.
The last two years brought challenges for investors across all walks of life, but particularly for retirees.
A new exchange-traded fund attempting to carve out a slice of the $6.3 trillion sitting in traditional money-market funds is launching Wednesday.
Fixed income strategy and opportunities have remained relatively unchanged over the past few months. However, the much-talked-about monetary policy change has commenced.
On September 18, the Federal Reserve cut the Federal funds rate, as expected, announcing at the same time that the Fed will continue to reduce its balance sheet. In my view, both of these decisions were appropriate. The Fed reduced short-term rates by 50 basis points, which was consistent with economic conditions that remain near the threshold of recession.
Since mid-2022, when the Federal Reserve was in the midst of its aggressive hiking cycle, investors piled over $1.6 trillion into money market funds, which include Treasury bills.
As GMO celebrates its 30th anniversary managing emerging debt this year, we offer our comprehensive guide to emerging debt markets. Given the tumultuous recent events – a global pandemic, defaults, repricing of interest rates, relentless strength in the U.S. dollar – we’ll focus on the Why as a starting point. Then we’ll dive into the proliferating How, covering strategies and vehicles.
With the decision on Wednesday to lower interest rates (for the first time since March of 2020) by a substantial 50 basis points (bps), rather than the 25 bps cut we typically see at the beginning of an easing cycle, the Fed is showing confidence that the disinflation trend will continue.
The yield curve measures the difference between short-term, intermediate-term, and long-term Treasury yields.
Investors are using their massive cash piles to lock in attractive yields in global bond markets, helping to limit losses in the asset class, according to Mohamed El-Erian.
Regardless of which administration takes power after an election, a balanced portfolio has made strong gains in the years immediately after.
On the back of recent cooling in economic growth, an uptick in unemployment, and moderating inflation, the Federal Reserve (Fed) looks set to begin its rate-cutting cycle at its September meeting.
We are entering a time I think will include a deep crisis. We are going to need each other. We really do need to “find our tribe.”
We often write about the opportunity for fixed income investors to lock in relatively attractive long-term rates. And we would argue that investment consultants and financial advisors have no more important charge than to convince their clients to take advantage of this while they still can.
When we’re viewing markets, it’s not surprising sentiment shifts quickly if we don’t instantly see the anticipated results. Market pundits quickly point fingers and determine the Fed, economists, and participants are wrong. Reactions can be powerful in number and sway momentum for stocks and/or bonds.
On this episode of the “ETF of the Week” podcast, VettaFi’s Head of Research Todd Rosenbluth discussed the JPMorgan Ultra-Short Income ETF (JPST) with Chuck Jaffe of “Money Life.” The pair talked about several topics regarding the fund to give investors a deeper understanding of the ETF overall.
As tax season draws nearer, advisors and investors increasingly look to their portfolio to optimize exposures for taxation purposes.
The level of U.S. Treasury yields and the changing shape of the Treasury yield curve provide investors with critical feedback regarding the market’s expectations for economic growth, inflation, and monetary policy
Elevated budget deficits imply growing US Treasury issuance. Receding demand from central banks could leave more price-sensitive buyers to pick up the slack. Who are the buyers of US government debt, and how is the market responding? In part two of our series, let’s examine Treasury market supply and demand.
It’s been the ultimate no-brainer for more than a year: Park your money in super-safe Treasury bills, earn yields of more than 5%, rinse and repeat. Or as billionaire bond investor Jeffrey Gundlach put it last October, “T-bill and chill.”
A recent article co-authored by Stephen Miran and Dr. Nouriel Roubini, aka Dr. Doom, accuses the U.S. Treasury Department of using its debt-issuance powers to manipulate financial conditions.
When US Federal Reserve Chair Jerome Powell speaks at next week’s annual economic conference in Jackson Hole, Wyoming, people will be listening intently for any hint about what the central bank will do with interest rates at its September policy making meeting.
The KraneShares Sustainable Ultra Short Duration Index ETF (KCSH) offers low risk income investing with notable yields and diversification.
The flexibility offered through individual bonds translates well for tailoring individual financial goals and needs.
Hastily, investors have turned their worry about inflation into worry about a recession. The catalyst was Friday’s unexpectedly disappointing unemployment number.
State Street’s George Milling-Stanley goes in-depth on the current gold market, physical gold ETFs, and crypto. VettaFi’s Roxanna Islam explores the world of defined outcome ETFs.
Dollar cost averaging involves committing money to the stock market gradually, rather than all at once. This time spent out of the market leads to lower returns, but also to commensurately lower risk.
The members of the Bank of England’s Monetary Policy Committee (MPC) are probably not intimately familiar with Taylor Swift’s back catalogue. If they were, Swift’s hit “Cruel Summer” may have been ringing in their ears when cutting rates today for the first time since March 2020.
Today’s passive index investing requires active choices, as customization and innovations in index funds have resulted in new considerations for investors and the potential for greater control.
Jeff and Ron discuss the state of the economy, inflation, the bond and stock markets, and they outline, in broad terms, their current investments.
We are approaching a turning point in policy decisions as the FOMC attempts to walk the fine line of hitting their inflation targets while maintaining a healthy labor market.
Volatility is back — at least a little — heading in to a week filled with central bank interest-rate decisions and quarterly earnings for some of the world’s biggest companies.
It's been another strong first half for the U.S. ETF industry, with overall flows set to challenge or surpass historic records.
The momentum we've seen in U.S. equity markets over the past year continued in the second quarter of 2024. With large technology stocks leading the wave, the S&P 500 index has risen 23% in the 12 months ended June 30.
Investors flocked to the US Treasury’s monthly sale of two-year notes in a powerful demonstration of faith in Federal Reserve interest-rate cuts beginning this year.
A recent Financial Times opinion piece laid out how illiquidity makes private equity hazardous for investors. The Bank of England’s Nathanaël Benjamin warns private equity illiquidity is a systemic risk to the financial system.
There are many advantages and risks associated with any investment. Whether you are buying a stock, a house, a business, or a bond, each investment has unique characteristics that allow an investor to gain from particular investment features with varying risks.
The stock market is not a balloon that gets bigger when money “flows into” it. It doesn’t get smaller because money “flows out” of it. Holding the number of shares constant, the stock market gets bigger if investors pay a higher price for those shares. Period.
Relatively high yields mean investors who have been focusing on short-term securities wouldn't need to sacrifice much yield if they chose MBS to help limit their reinvestment risk.
A Structured Protection ETF like CPRJ can offer robust tax benefits for investors seeking to move cash or get exposure to small-cap equities.
Portfolio Manager Daniel Siluk believes subsiding inflation and declining interest rates underpin a compelling argument for investors to reallocate funds away from money market strategies toward shorter-dated bonds.
In the post-pandemic fiscal landscape, government debt trajectories may be volatile, but appear broadly sustainable.
Conflicts are everywhere in financial planning. They exist in all fee models, whether they be commissions, assets under management, fixed fee, or hourly. Any time money changes hands there are conflicts of interests.
No matter who wins November’s US presidential election, there’s a growing risk that Americans will be paying higher taxes next year, according to MacKay Shields LLC. That makes muni bonds an attractive shield.
With high yields and compelling opportunities, we think the muni market looks exceptionally attractive today.
Investors continue to pile into bond funds, looking to add yield now before the Federal Reserve starts instituting rate cuts.
Earnings season is just around the corner. It could prove critical to justifying the record rally we’ve seen thus far in 2024.
The expert and you are in a car and the expert is driving. After awhile, you notice that the expert is driving the car by looking through the rearview mirror. Concerned you ask him why he’s not looking ahead as he drives.
We’re borrowing from the upcoming Paris Summer Olympics for our quarterly theme – with a twist. Instead of using the most popular events (like gymnastics, swimming, and track & field) to express our views, we’ll go beyond the spotlight.
Don’t miss out. Prepare to take advantage of opportunities in the second half.
How to help position your portfolio in anticipation of an economic downturn.
Market expectations for Federal Reserve rate cuts in 2024 have shifted dramatically, from six cuts expected at the start of the year, to barely one or two at this writing. Here’s why we think the US economy’s resilience and the year-to-date increase in yields may prolong an attractive opportunity in fixed income.
I may as well just say it. Based on the present combination of extreme valuations, unfavorable and deteriorating market internals, and a rare preponderance of warning syndromes in weekly and now daily data, my impression is that the speculative market advance since 2009 ended last week.
It’s certainly a challenging time to be an investor. It's probably why a call for caution and diversification seems to be getting louder.
VettaFi discusses spot ether ETFs, spot bitcoin ETFs, and the crypto ETF universe.
Historically, the level of U.S. debt has had no correlation with the performance of the stock or bond markets.
A defining feature of the post-COVID investment regime has been the persistence of elevated market uncertainty and volatility. The below visual highlights how this has led to a wider range of market performance outcomes, focusing in on the vast difference between the last two calendar years.
Portfolio Manager John Lloyd discusses two important considerations for investors who feel like they may have missed the market rally.
As the political machinery of an election year roars to life, inundating every media platform with its cacophony, it becomes increasingly challenging to block out the pervasive noise. However, amid this clamor, there are compelling reasons why maintaining focus on your investment strategy is imperative.
Data is important but not everything. Perceptions matter, too. Today we’ll look at how people feel inflation and what it may mean in the years to come.
Predicting Fed rate changes may be an inexact exercise, but understanding how the tools that do track it work can help investors weather uncertain markets.
Ross Riskin's op-ed examines the potential drawbacks of using glide path portfolios in 529 college savings plans, particularly during high-interest rate environments. He suggests that money market options may offer better capital preservation for funds needed during college enrollment, emphasizing the shift from growth to stability in investment strategies.
While there is much debate over whether another bear market is imminent, weekly moving average crossovers suggest a different outcome for now. There are many current concerns, from geopolitical risk to still inverted yield curves, slowing economic growth, high interest rates, and inflation. Yet, despite those concerns, markets are flirting with all-time highs.
Will the rapid growth of private credit impair financial stability?
JPMorgan Chase & Co.’s asset management arm has created a new European money market fund focused on public debt, a kind of investment that largely disappeared when interest rates were negative.
The U.S. repurchase agreement, or “repo” market, provides more than $3 trillion in short-term funding each day. Most repo transactions are overnight and are collateralized by Treasuries.
In this PIMCO Perspectives, we examine how the return of elevated bond yields comes at an opportune time to consider shifting out of cash.
It can be easy to overthink the markets and it is human nature to try to out-guess, out-maneuver, or out-smart the average, but perhaps we can step back and simplify what seems to be occurring.
As of last week, the total return of the S&P 500 was even with 3-month Treasury bill returns since the valuation peak of January 2022, more than two years ago. In our view, investors continue to “grasp at the suds of yesterday’s bubble,” ignoring extreme valuations, lopsided bullish sentiment, emerging pressure on profit margins, economic conditions at the border of recession...
There are attractive investment opportunities in private credit against a backdrop of a U.S. economy that continues to outpace the eurozone and the U.K.
High quality short-term bonds offer a number portfolio benefits while putting excess cash to work, but what's under the hood matters.
Various methods to estimate this key bond market gauge differ on details but appear to signal rising investor compensation.
Cash and Short-Term Funds
The Bond Market Update: What You Need to Know
Things are looking up for bonds - learn what makes them a great addition to your portfolio right now.
2024 Economic & Market Outlook: The Final Stretch
Here we are, another calendar quarter down with one more to go in 2024, and investors have yet to see a “hard landing” emerge.
Private Credit’s Banking Romance May Turn Sour
To understand the wave of bank partnerships with private-credit fund managers during the past year or so, think back to the boom in mortgage lending through securitization in the early 2000s. The same forces are at work: a huge demand for finance, limited and costly bank capital and investment bankers’ ingenuity and desire to generate business.
Look at Duration During Fed Rate Cutting Cycles
Volatile interest rates have spurred investment capital into motion. Clients often ask where they should allocate on the yield curve.
Fixed Income Market Update
The FOMC lowered the Fed Funds rate by 50 basis points at their September meeting. This was the first cut in over four years and the start of what is expected to be a multi-year easing cycle.
Is College 529 Financial Planning Really That Simple?
It's important to stay informed regarding the latest updates to 529 college savings plans, for both current account holders and prospective savers. In recent years there have been significant changes, including The Setting Every Community Up for Retirement Enhancement (SECURE) 2.0 Act in December of 2022, which helps enhance the flexibility and benefits of 529 plans.
Investing in an Era of Flouted Rules
The tendency to blindly follow these rules has led investors towards prematurely de-risking and over-estimating the likelihood of recession.
The Multifaceted Impact of Federal Reserve Easing Cycles on Financial Markets
Fed easing cycles and lowered target interest rates impact various economic sectors, such as mortgages, consumer credit and cash investments.
Subsets and Sensibility
One of most dangerous habits of a speculative crowd is the tendency to use unconditional averages and unconditional probabilities regardless of how extreme market conditions have become. This is like stepping into a house with two rooms, one with the temperature at 0 degrees and one at 140 degrees, and expecting a temperature of 70 either way.
Volatility: What to Do During Turbulence
Turbulent market conditions can make anyone nervous. Here's what investors should know about dealing with them.
Inflation Bites Into Cash Investments. Instead, Opt for Equities
Cash strategies may seem safe, but inflation can bite into returns. Instead, investors can try to outperform inflation with equities.
U.S. Versus International Stock Performance
U.S. stocks have handily outperformed their global peers over the past few decades, as well as in the post-World War II period. We document the scale of the outperformance and ask whether it can continue.
Hard or Soft?
Everything I’ve learned and experienced in 50+ years of watching the economy tells me not to expect a soft landing. But maybe that’s because I’ve never actually seen one.
Fed Rate Cuts Signal Economic Shift: What’s Next for Investors?
As the Fed shifts its stance, investors must now weigh the broader economic implications.
Bank Earnings Start as Lower Rate Impact Debated
After the Fed's 50-basis-point rate cut, big banks kick off earnings season amid fears that lower rates could hurt the net-interest income that propelled growth the last two years.
The “Everything Market” Could Last A While Longer
We are currently in the “everything market.” It doesn’t matter what you have probably invested in; it is currently increasing in value. However, it isn’t likely for the reasons you think. A recent Marketwatch interview with the always bullish Jim Paulson got his reasoning for the rally.
Fixed-Income Outlook: Strategies for a Controlled Descent
We expect bond yields to trend gradually lower—but it may be a bumpy ride. These seven strategies may help investors take advantage.
7 Reasons to Consider Municipal Bonds Now
We believe municipal bonds currently offer a compelling balance of risk and reward for investors in higher tax brackets.
The Appeal of Agency Mortgage-Backed Securities in a Shifting Economic Landscape
While agency mortgage-backed securities offer compelling valuations, not every mortgage is created equally.
For Retirees, Interest Rates & Inflation Remain Risks
The last two years brought challenges for investors across all walks of life, but particularly for retirees.
The $6.3 Trillion Money-Market Industry Just Got Its First ETF
A new exchange-traded fund attempting to carve out a slice of the $6.3 trillion sitting in traditional money-market funds is launching Wednesday.
Fixed Income Strategy as the Economic Cycle Takes a Turn
Fixed income strategy and opportunities have remained relatively unchanged over the past few months. However, the much-talked-about monetary policy change has commenced.
Asking a Better Question
On September 18, the Federal Reserve cut the Federal funds rate, as expected, announcing at the same time that the Fed will continue to reduce its balance sheet. In my view, both of these decisions were appropriate. The Fed reduced short-term rates by 50 basis points, which was consistent with economic conditions that remain near the threshold of recession.
Considering Moving Out of T-bills? A Guide to Determine What’s Next in Your Portfolio
Since mid-2022, when the Federal Reserve was in the midst of its aggressive hiking cycle, investors piled over $1.6 trillion into money market funds, which include Treasury bills.
The What-Why-When-How Guide to Owning Emerging Debt
As GMO celebrates its 30th anniversary managing emerging debt this year, we offer our comprehensive guide to emerging debt markets. Given the tumultuous recent events – a global pandemic, defaults, repricing of interest rates, relentless strength in the U.S. dollar – we’ll focus on the Why as a starting point. Then we’ll dive into the proliferating How, covering strategies and vehicles.
The Federal Reserve Just Slashed Rates by 50 Basis Points
With the decision on Wednesday to lower interest rates (for the first time since March of 2020) by a substantial 50 basis points (bps), rather than the 25 bps cut we typically see at the beginning of an easing cycle, the Fed is showing confidence that the disinflation trend will continue.
Getting Back to Normal: The Yield Curve
The yield curve measures the difference between short-term, intermediate-term, and long-term Treasury yields.
El-Erian Says Cash on Sidelines Is Minimizing Bond Market Losses
Investors are using their massive cash piles to lock in attractive yields in global bond markets, helping to limit losses in the asset class, according to Mohamed El-Erian.
Who’s Going to Win the U.S. Presidential Election? For Markets, Does It Really Matter?
Regardless of which administration takes power after an election, a balanced portfolio has made strong gains in the years immediately after.
Do AAA CLOs Still Make Sense in a Declining Rate Environment?
On the back of recent cooling in economic growth, an uptick in unemployment, and moderating inflation, the Federal Reserve (Fed) looks set to begin its rate-cutting cycle at its September meeting.
The Time Has Come
We are entering a time I think will include a deep crisis. We are going to need each other. We really do need to “find our tribe.”
Two in the Bush: Still Time to Lock in Long-Term Rates
We often write about the opportunity for fixed income investors to lock in relatively attractive long-term rates. And we would argue that investment consultants and financial advisors have no more important charge than to convince their clients to take advantage of this while they still can.
A Slow Moving Economic Cycle
When we’re viewing markets, it’s not surprising sentiment shifts quickly if we don’t instantly see the anticipated results. Market pundits quickly point fingers and determine the Fed, economists, and participants are wrong. Reactions can be powerful in number and sway momentum for stocks and/or bonds.
JPMorgan Ultra-Short Income ETF (JPST)
On this episode of the “ETF of the Week” podcast, VettaFi’s Head of Research Todd Rosenbluth discussed the JPMorgan Ultra-Short Income ETF (JPST) with Chuck Jaffe of “Money Life.” The pair talked about several topics regarding the fund to give investors a deeper understanding of the ETF overall.
The Tax Implications of Your Short-Term Investments
As tax season draws nearer, advisors and investors increasingly look to their portfolio to optimize exposures for taxation purposes.
Yield Curve Shifts Offer Signals for Stockholders
The level of U.S. Treasury yields and the changing shape of the Treasury yield curve provide investors with critical feedback regarding the market’s expectations for economic growth, inflation, and monetary policy
Gradually, then Suddenly: Financing the Nation’s Growing Debt
Elevated budget deficits imply growing US Treasury issuance. Receding demand from central banks could leave more price-sensitive buyers to pick up the slack. Who are the buyers of US government debt, and how is the market responding? In part two of our series, let’s examine Treasury market supply and demand.
‘T-Bill and Chill’ Is a Hard Habit for Investors to Break
It’s been the ultimate no-brainer for more than a year: Park your money in super-safe Treasury bills, earn yields of more than 5%, rinse and repeat. Or as billionaire bond investor Jeffrey Gundlach put it last October, “T-bill and chill.”
Stealth QE Or Rubbish From Dr. Doom?
A recent article co-authored by Stephen Miran and Dr. Nouriel Roubini, aka Dr. Doom, accuses the U.S. Treasury Department of using its debt-issuance powers to manipulate financial conditions.
Five Big Questions for the Fed at Jackson Hole
When US Federal Reserve Chair Jerome Powell speaks at next week’s annual economic conference in Jackson Hole, Wyoming, people will be listening intently for any hint about what the central bank will do with interest rates at its September policy making meeting.
Diversify Your Income Portfolio Without Sacrificing Yields
The KraneShares Sustainable Ultra Short Duration Index ETF (KCSH) offers low risk income investing with notable yields and diversification.
Long-Term Strategic Fixed Income Allocation
The flexibility offered through individual bonds translates well for tailoring individual financial goals and needs.
Heightened Volatility
Hastily, investors have turned their worry about inflation into worry about a recession. The catalyst was Friday’s unexpectedly disappointing unemployment number.
Deep Dive with State Street’s Chief Gold Strategist
State Street’s George Milling-Stanley goes in-depth on the current gold market, physical gold ETFs, and crypto. VettaFi’s Roxanna Islam explores the world of defined outcome ETFs.
Does Dollar Cost Averaging Affect Investment Results?
Dollar cost averaging involves committing money to the stock market gradually, rather than all at once. This time spent out of the market leads to lower returns, but also to commensurately lower risk.
Bank of England Cuts Rates Despite Taylor Swift Inflation Effect
The members of the Bank of England’s Monetary Policy Committee (MPC) are probably not intimately familiar with Taylor Swift’s back catalogue. If they were, Swift’s hit “Cruel Summer” may have been ringing in their ears when cutting rates today for the first time since March 2020.
Index Investing as an Active Decision: Implications for Equity Investors
Today’s passive index investing requires active choices, as customization and innovations in index funds have resulted in new considerations for investors and the potential for greater control.
Muhlenkamp & Company Quarterly Letter – July 2024
Jeff and Ron discuss the state of the economy, inflation, the bond and stock markets, and they outline, in broad terms, their current investments.
Fed Week – Is a Rate Cut on Deck?
We are approaching a turning point in policy decisions as the FOMC attempts to walk the fine line of hitting their inflation targets while maintaining a healthy labor market.
Traders Eye Fed, BOJ Rate Talks With Markets Roiled by Earnings
Volatility is back — at least a little — heading in to a week filled with central bank interest-rate decisions and quarterly earnings for some of the world’s biggest companies.
U.S. ETF Flows: Investors Are Getting Polarized
It's been another strong first half for the U.S. ETF industry, with overall flows set to challenge or surpass historic records.
Navigating the Markets: Insights From Our Q2 Economic and Market Review
The momentum we've seen in U.S. equity markets over the past year continued in the second quarter of 2024. With large technology stocks leading the wave, the S&P 500 index has risen 23% in the 12 months ended June 30.
Two-Year Treasuries See Record Investor Demand at Auction
Investors flocked to the US Treasury’s monthly sale of two-year notes in a powerful demonstration of faith in Federal Reserve interest-rate cuts beginning this year.
Private Equity Is Illiquid by Design. Why Worry About It?
A recent Financial Times opinion piece laid out how illiquidity makes private equity hazardous for investors. The Bank of England’s Nathanaël Benjamin warns private equity illiquidity is a systemic risk to the financial system.
Reinvestment Risk
There are many advantages and risks associated with any investment. Whether you are buying a stock, a house, a business, or a bond, each investment has unique characteristics that allow an investor to gain from particular investment features with varying risks.
You’re Soaking in It
The stock market is not a balloon that gets bigger when money “flows into” it. It doesn’t get smaller because money “flows out” of it. Holding the number of shares constant, the stock market gets bigger if investors pay a higher price for those shares. Period.
Why to Consider Mortgage-Backed Securities Now
Relatively high yields mean investors who have been focusing on short-term securities wouldn't need to sacrifice much yield if they chose MBS to help limit their reinvestment risk.
Try a More Tax-Efficient Small-Cap Strategy
A Structured Protection ETF like CPRJ can offer robust tax benefits for investors seeking to move cash or get exposure to small-cap equities.
Outpacing Money Markets: The Historical Yield Advantage of Short-Dated Bonds
Portfolio Manager Daniel Siluk believes subsiding inflation and declining interest rates underpin a compelling argument for investors to reallocate funds away from money market strategies toward shorter-dated bonds.
Developed Market Public Debt: Risks and Realities
In the post-pandemic fiscal landscape, government debt trajectories may be volatile, but appear broadly sustainable.
Fiduciary Duty – Theory versus Reality
Conflicts are everywhere in financial planning. They exist in all fee models, whether they be commissions, assets under management, fixed fee, or hourly. Any time money changes hands there are conflicts of interests.
Tax Hikes Seen No Matter Who’s President, Making Muni Bonds Attractive
No matter who wins November’s US presidential election, there’s a growing risk that Americans will be paying higher taxes next year, according to MacKay Shields LLC. That makes muni bonds an attractive shield.
Municipal Mid-Year Outlook: End the Waiting Game
With high yields and compelling opportunities, we think the muni market looks exceptionally attractive today.
Investors Pile Into Bond Funds Amid Attractive Yields
Investors continue to pile into bond funds, looking to add yield now before the Federal Reserve starts instituting rate cuts.
Q2 Earnings Season: Financials First Up to Bat
Earnings season is just around the corner. It could prove critical to justifying the record rally we’ve seen thus far in 2024.
Monthly Global Economic Report
The expert and you are in a car and the expert is driving. After awhile, you notice that the expert is driving the car by looking through the rearview mirror. Concerned you ask him why he’s not looking ahead as he drives.
City of Lights, Market of Opportunities
We’re borrowing from the upcoming Paris Summer Olympics for our quarterly theme – with a twist. Instead of using the most popular events (like gymnastics, swimming, and track & field) to express our views, we’ll go beyond the spotlight.
Fixed-Income Midyear Outlook: Sail with the Tide
Don’t miss out. Prepare to take advantage of opportunities in the second half.
5 Tips for Weathering a Recession
How to help position your portfolio in anticipation of an economic downturn.
Midyear Fixed Income Outlook: Solid but Slowing, a Favorable Environment for Fixed Income
Market expectations for Federal Reserve rate cuts in 2024 have shifted dramatically, from six cuts expected at the start of the year, to barely one or two at this writing. Here’s why we think the US economy’s resilience and the year-to-date increase in yields may prolong an attractive opportunity in fixed income.
You Can Ring My Bell
I may as well just say it. Based on the present combination of extreme valuations, unfavorable and deteriorating market internals, and a rare preponderance of warning syndromes in weekly and now daily data, my impression is that the speculative market advance since 2009 ended last week.
State Street Rebalance of Active ETF Models Hint at Caution
It’s certainly a challenging time to be an investor. It's probably why a call for caution and diversification seems to be getting louder.
Crypto ETFs: Ether Not an Either/Or Story With Bitcoin
VettaFi discusses spot ether ETFs, spot bitcoin ETFs, and the crypto ETF universe.
Deficits, Debt and Markets: Myths vs. Realities
Historically, the level of U.S. debt has had no correlation with the performance of the stock or bond markets.
Targeting Uncorrelated Returns in Uncertain Markets
A defining feature of the post-COVID investment regime has been the persistence of elevated market uncertainty and volatility. The below visual highlights how this has led to a wider range of market performance outcomes, focusing in on the vast difference between the last two calendar years.
You Missed the Market Rally. Now What?
Portfolio Manager John Lloyd discusses two important considerations for investors who feel like they may have missed the market rally.
Consistency is the Key Amidst the Noise of a Presidential Election
As the political machinery of an election year roars to life, inundating every media platform with its cacophony, it becomes increasingly challenging to block out the pervasive noise. However, amid this clamor, there are compelling reasons why maintaining focus on your investment strategy is imperative.
Inflationary Perceptions
Data is important but not everything. Perceptions matter, too. Today we’ll look at how people feel inflation and what it may mean in the years to come.
Why Fed Forecasting Tools Are Worth Watching
Predicting Fed rate changes may be an inexact exercise, but understanding how the tools that do track it work can help investors weather uncertain markets.
When it Comes to 529 Plans, “Target” Enrollment Portfolios Can Miss the “Mark”
Ross Riskin's op-ed examines the potential drawbacks of using glide path portfolios in 529 college savings plans, particularly during high-interest rate environments. He suggests that money market options may offer better capital preservation for funds needed during college enrollment, emphasizing the shift from growth to stability in investment strategies.
Moving Average Crossovers Suggest The Bull Is Back
While there is much debate over whether another bear market is imminent, weekly moving average crossovers suggest a different outcome for now. There are many current concerns, from geopolitical risk to still inverted yield curves, slowing economic growth, high interest rates, and inflation. Yet, despite those concerns, markets are flirting with all-time highs.
Shedding Light on Private Credit
Will the rapid growth of private credit impair financial stability?
JPMorgan Asset Revives Government-Focused Money Market Fund
JPMorgan Chase & Co.’s asset management arm has created a new European money market fund focused on public debt, a kind of investment that largely disappeared when interest rates were negative.
Could Quantitative Tightening Cause Another Liquidity Crisis in Repo Markets?
The U.S. repurchase agreement, or “repo” market, provides more than $3 trillion in short-term funding each day. Most repo transactions are overnight and are collateralized by Treasuries.
The Cost of Cash: A $6 Trillion Question
In this PIMCO Perspectives, we examine how the return of elevated bond yields comes at an opportune time to consider shifting out of cash.
What's Moving the Bond Market?
It can be easy to overthink the markets and it is human nature to try to out-guess, out-maneuver, or out-smart the average, but perhaps we can step back and simplify what seems to be occurring.
This Is Where You Start Bear Markets From
As of last week, the total return of the S&P 500 was even with 3-month Treasury bill returns since the valuation peak of January 2022, more than two years ago. In our view, investors continue to “grasp at the suds of yesterday’s bubble,” ignoring extreme valuations, lopsided bullish sentiment, emerging pressure on profit margins, economic conditions at the border of recession...
U.S. Private Credit: What the Markets Are Missing About Attractive Risk-Reward Tradeoff
There are attractive investment opportunities in private credit against a backdrop of a U.S. economy that continues to outpace the eurozone and the U.K.
3 Tips When Looking to Short-Term Bonds
High quality short-term bonds offer a number portfolio benefits while putting excess cash to work, but what's under the hood matters.
Will the True Treasury Term Premium Please Stand Up?
Various methods to estimate this key bond market gauge differ on details but appear to signal rising investor compensation.