Emerging Markets have been outright crushed this year. This is part of the capital flows exiting these hot economies as fear of the Fed cutting back on QE grows. It’s important to be patient when investing in any asset class, but it’s double important when it comes to the Emerging Markets. These economies/companies are very…
G’day Mate!
I’ve been looking more to the currencies as a bond alternative lately. Artificially low interest rates have skewed the market to where I don’t feel investors are being fairly compensated for a lot of the risks associated with bonds right now. Recently, I’ve had my eye on the Aussie dollar. The Australian dollar has benefited…
Q1 Update
Now that the first quarter of 2013 has come to a close, let’s take a look at capital flows. The first chart below shows stocks (S&P 500) against bonds (10 year Treasury). Typically, money moves back and forth between stocks and bonds as investors are either comfortable with taking risk or feel risk adverse. Since…
Market Update: High Yields & The Disaster Formerly Known As Europe
I haven’t written in a few weeks now (partially because I’m a March Madness fanatic) so today’s post will cover two items that are on my mind this week. Leveraged Loans The leveraged loan market is all the craze, as covered in the Wall Street Journal and Financial Times earlier this month. For those unfamiliar,…
Municipal Bonds
I suppose that sometimes being lucky is better than being good. I think we’re now seeing the shock to muni bonds that I was expecting, just didn’t expect it this quickly! High yield muni bonds look like someone pushed them off a “fiscal cliff,” falling 4.5% the past 3 days trading days alone. That’s an…
Opportunities Lie Ahead…
I made some major changes to municipal bond holdings again this week. Always a tough decision since they’re held in taxable accounts and thus it is a taxable event, but managing risk always trumps avoiding taxes. While everyone is focused on the exciting stock market, it’s the bond market that is starting to worry me. …
High Yield Municipal Bonds
Earlier today I cut positions in high yield muni bonds in half. Why am I selling muni bonds when everyone else seems to be buying them? Well, that’s part of the answer. Since president Obama won reelection, there’s been a flood of new money coming into municipal bonds (all types of muni’s), pushing them from…
Market Update – Bonds
This post will cover my outlook for the various types of bonds. I tried to keep it easy to follow but I’m sure there is some fancy finance jargon, which I apologize for ahead of time. I’ll write an educational piece on how bonds work later this month (you might be surprised to find out there’s…