Sentences with phrase «credit spreads»

Investors will also look at credit spreads for clues as to where the bond and other markets may be headed.

An imbalance in supply and demand in the income market may result in valuation uncertainties and greater volatility, less liquidity, widening credit spreads and a lack of price transparency in the market.

In times of tight credit spreads, the pressure on these banks to «cheat» when it comes to risk taking and disclosure becomes irresistible.

The risk inherent in these strategies rises disproportionately as credit spreads narrow, so we favor an up - in - quality stance and emphasize liquidity.

Some of them are experiencing stress, and that is coming through higher credit spreads on their debt.

Put differently, a 5 % or greater correction is two times more likely to occur when credit spreads jumped in the previous month.

In low interest rate environments with narrow credit spreads, preferred stocks behave similarly to bonds.

This will sound weird, but I am not as much worried about government bond rates rising, as I am with credit spreads rising.

High - grade corporate credit spreads are also near all - time lows.

By selling a bull put credit spread in these circumstances, a trader is able to maximize his / her potential profitability by taking in more premiums than if implied volatility was lower.

The wide credit spreads of recent months will almost certainly help to suppress inflation reports as the year continues.

You can read more about how credit spreads change over time here.

There is a common misconception that looking at credit spreads gives you a complete picture of the credit risk of one bond compared to another.

The problem comes because of the scarcity of assets, one reason why high - yield credit spreads have been tightening even as short term funding rates have risen.

Credit spread risk is an important but often ignored component of income investing.

# 5 it is possible to design a high winning percentage system selling options but I would advise credit spreads over naked options.

In the bust, credit spreads rise, cutting off the possibility of refinancing.

Through the bust, equity volatility and credit spreads remain high; they are correlated phenomena, but there is a point of exhaustion.

The general thinking is «low credit spreads = investors have a strong appetite for risk».

This is particularly true in the corporate bond market where credit spreads (the gap between treasury and corporate borrowing costs) have remained close to all - time lows.

In a rising rate environment, credit spreads tend to tighten, reflecting improved credit fundamentals in a growing economy.

Lower volatility and tighter credit spreads make it harder to generate income from selling related options.

To its credit though, the slightly superior model behaves the way that it should in theory, in term of how credit spreads move.

Canadian credit spreads going forward will be more open to influences from foreign markets and will increasingly move with swap spreads and the Canadian dollar.

The second type of spread risk comes from credit spreads.

But those looking only at credit spreads get the wrong result also.

Generally speaking, floating - rate instruments have a two - part coupon: a market - driven base rate plus a contractual credit spread.

If the conservative approach offered by collars appeals to you, consider selling the put credit spread instead.

Today's tight credit spreads reflect low levels of market volatility.

Some of these factors include company performance, call provisions of the specific share class, and the required credit spread of the preferred asset class above risk - free assets.

After all, it was only 18 months ago that a plunge in oil prices, coupled with fears over Chinese growth, sent high yield plunging and credit spreads soaring.

A narrow credit spread indicates high expectations for the economy and corporate world.

For credit markets, default rates are low, but extraordinarily tight credit spreads largely already reflect that fact.

Credit spreads fall when conditions are stable, until enough marginal borrowers take on debts that they can't afford, and the bust phase of the credit cycle kicks in.

At market tops, typically credit spreads are tight, but they have been tight for several years, while seemingly cheap leverage builds up.

You'll receive credit for the free phone in the form of monthly bill credits spread out over that 24 - month period.

And what happens to market volatility as the end of official suppression of rates and credit spreads slowly plays out.

Credit spreads confirm the speculative nature of this market with spreads narrowing 12 basis points over the last month.

During those times the slope of the yield curve tells you a lot, and credit spreads tell you a lot as well.

Obviously, there are dangers in credit spread exchanging; there is constantly some level of danger included in a venture.

In this session, you'll learn about bull and bear credit spreads and how to adjust for risk, reward, and probability.

Much of the reason for the miss is rising credit spreads through the quarter.

As they have done so, credit spreads on these assets have declined, which means that investors are receiving less compensation for the risk they are taking on.