Bloomberg Gadfly's Lisa Abramowicz (follow her on twitter here) outlined in a recent piece The Credit Boom that Just Won't Die the insatiable demand
for investment grade credit.
Not exact matches
In the
credit markets, both
investment -
grade and high - yield corporate bonds had negative returns
for the first time in eight quarters, with down - in - quality subsectors in each unconventionally outperforming higher quality ones.
Finally, it was a banner year
for credit, with spreads narrowing across
investment grade, high yield and emerging markets.
Another way is to boost yield is to relax
credit quality a little by opting
for investment grade corporate bonds instead of triple - A government treasuries.
We remain overweight U.S
credit for its income potential, but prefer
investment grade debt given elevated
credit market valuations.
Interest - rate risk is generally greater
for longer - term bonds, and
credit risk is generally greater
for below -
investment -
grade bonds, which may be considered speculative.
Stock analysts
grade companies every day and give them ratings
for credit worthiness and
investment grade.
There was a weaker correlation between the ability to trade (daily trading volume, issue size and frequency of zero - trading days) and
credit spreads
for both
investment -
grade and high - yield markets.
In pursuance of the Union Budget 2018 announcement, the board also cleared a proposal on changing the
investment grade rating from AA to A
for corporate bonds, which would boost
investment scope while ensuring
credit quality.
Floating - rate loans» low
credit ratings indicate greater potential risk of default relative to
investment -
grade bonds (though default rates
for floating - rate loans historically have been lower than on high - yield bonds).
Greenlight discussed its plan privately with GM
for a number of months but went public after the board dismissed the plan citing a number of concerns, including valuation uncertainty, the potential to jeopardize GM's
investment grade credit rating, a lack of established market demand and governance conflicts associated with a dual - class structure.
For example, by comparing a group of corporate bonds (like
investment grade corporate bonds) vs. treasuries, you get a picture of where the average
investment grade bond
credit spread currently stands.
We prefer U.S.
investment grade bonds against this backdrop of reduced compensation
for credit risk.
In 2015 Creditex expanded into serving the bond market, through the launch of ICE
Credit Trade, a leading electronic platform
for trading
investment grade and high yield corporate bonds.
Interest - rate risk is greater
for longer - term bonds, and
credit risk is greater
for below -
investment -
grade bonds.
Given the introduction of several new ECB policies yesterday (expanded QE; purchases of nonfinancial,
investment grade corporate debt; new refinancing programs; incentives to reduce the impact of negative interest rates on banks and spur lending) we think the outlook
for European
credit and equities is quite constructive.
Now Larry Swedroe outlines the case
for avoiding
investment grade credit risk altogether.
He joined Leith Wheeler from TD Bank in January 2009, where he'd spent the previous 10 years trading a proprietary bank portfolio of
credit default swaps,
investment grade and high yield bonds
for TD in New York and London.
Using total
credit premiums, trading volumes and characteristics
for a broad sample of U.S.
investment grade and high yield corporate bonds during January 1994 through December 2015, he finds that: Keep Reading
BOOF materials cover a progression of concepts
for grades 4 - 12, from needs versus wants to banking and
credit to basic
investment.
(B) SENIOR DEBT. - Notwithstanding subparagraph (A), in a case in which the Federal
credit instrument is the senior debt, the Federal
credit instrument shall be required to receive an
investment grade rating from at least 2 rating agencies, unless the
credit instrument is
for an amount less than $ 75,000,000, in which case 1 rating agency opinion shall be sufficient.»
-» (A) IN GENERAL. - To be eligible
for assistance under this chapter, a project shall satisfy applicable creditworthiness standards, which, at a minimum, shall include -» (i) a rate covenant, if applicable;» (ii) adequate coverage requirements to ensure repayment;» (iii) an
investment grade rating from at least 2 rating agencies on debt senior to the Federal
credit instrument; and» (iv) a rating from at least 2 rating agencies on the Federal
credit instrument, subject to the condition that, with respect to clause (iii), if the total amount of the senior debt and the Federal
credit instrument is less than $ 75,000,000, 1 rating agency opinion
for each of the senior debt and Federal
credit instrument shall be sufficient.»
[199] The assessment of the senior obligations»
investment grade potential and the default risk
for the TIFIA
credit instrument and the senior obligations should be based on the underlying ratings of the unenhanced debt obligations and the project's fundamentals.
In such a structure, the
investment grade ratings
for senior debt helps the DOT evaluate its
credit risk as a subordinate lender.
Each potential applicant
for TIFIA
credit assistance must provide a preliminary rating opinion letter from at least one Credit Rating Agency [187] indicating that the project's senior obligations (which may include the TIFIA credit instrument) have the potential to achieve an investment grade rating and providing a preliminary rating opinion on the TIFIA credit instrument and provides rating rationales for both preliminary ra
credit assistance must provide a preliminary rating opinion letter from at least one
Credit Rating Agency [187] indicating that the project's senior obligations (which may include the TIFIA credit instrument) have the potential to achieve an investment grade rating and providing a preliminary rating opinion on the TIFIA credit instrument and provides rating rationales for both preliminary ra
Credit Rating Agency [187] indicating that the project's senior obligations (which may include the TIFIA
credit instrument) have the potential to achieve an investment grade rating and providing a preliminary rating opinion on the TIFIA credit instrument and provides rating rationales for both preliminary ra
credit instrument) have the potential to achieve an
investment grade rating and providing a preliminary rating opinion on the TIFIA
credit instrument and provides rating rationales for both preliminary ra
credit instrument and provides rating rationales
for both preliminary ratings.
Note that if the total amount of the RRIF direct loan or loan guarantee is greater than $ 75 million, the applicant must provide an
investment grade rating on the RRIF
credit instrument from at least two Credit Rating Agencies for the DOT to incorporate such ratings into its calculation of the CRP (45 U.S.C. § 822 (f)(3)(C)
credit instrument from at least two
Credit Rating Agencies for the DOT to incorporate such ratings into its calculation of the CRP (45 U.S.C. § 822 (f)(3)(C)
Credit Rating Agencies
for the DOT to incorporate such ratings into its calculation of the CRP (45 U.S.C. § 822 (f)(3)(C)-RRB-.
Notwithstanding subparagraph (A), in a case in which the Federal
credit instrument is the senior debt, the Federal
credit instrument shall be required to receive an
investment grade rating from at least 2 rating agencies, unless the
credit instrument is
for a rural infrastructure project or intelligent transportation systems project, in which case 1 rating agency opinion shall be sufficient.
We remain overweight U.S
credit for its income potential, but prefer
investment grade debt given elevated
credit market valuations.
These are bonds from issuers whose risk levels prevent them from qualifying
for «
investment grade ratings» by the primary bond
credit rating agencies.
And in this search
for higher yields, we find investors are reaching deeper and deeper into lower -
grade fixed - income products, which come with significant
credit and interest rate risks,» says Som Seif, president and CEO of Purpose
Investments, through a statement.
After the bull market kicked off six years ago, as investors searched
for yield amid low interest rates, they increasingly turned toward fixed income
credit sectors, such as high yield,
investment grade and emerging market debt.
We prefer U.S.
investment grade bonds against this backdrop of reduced compensation
for credit risk.
He is responsible
for credit research, with a focus on conducting fundamental analysis of
investment -
grade and high - yield banking and financial companies.
We are overweight U.S.
credit with a preference
for investment grade bonds.
This flight to quality movement also impacted
credit spreads, which widened
for both
investment grade and high yield corporate bonds, negatively impacting the returns of bonds in those sectors.
It is also responsible
for setting the research agenda
for the
investment -
grade corporate
credit team.
Interest - rate risk is generally greater
for longer - term bonds, and
credit risk is generally greater
for below -
investment -
grade bonds.
For instance, a rising price ratio for iShares 7 - 10 Year Treasury (IEF): iShares iBoxx High Yield Corporate Bond (HYG) is indicative of a preference for risk - off investment grade credit over speculative higher yielding cred
For instance, a rising price ratio
for iShares 7 - 10 Year Treasury (IEF): iShares iBoxx High Yield Corporate Bond (HYG) is indicative of a preference for risk - off investment grade credit over speculative higher yielding cred
for iShares 7 - 10 Year Treasury (IEF): iShares iBoxx High Yield Corporate Bond (HYG) is indicative of a preference
for risk - off investment grade credit over speculative higher yielding cred
for risk - off
investment grade credit over speculative higher yielding
credit.
Jettison a lower quality junk bond ETF
for a higher quality
investment grade corporate bond ETF like iShares Intermediate
Credit (CIU).
Interest - rate risk is generally greater
for longer - term bonds, and
credit risk is greater
for below -
investment -
grade bonds.
There was a weaker correlation between the ability to trade (daily trading volume, issue size and frequency of zero - trading days) and
credit spreads
for both
investment -
grade and high - yield markets.
For investors willing to accept an incrementally higher level of
credit risk with a portfolio of one - to three - year
investment -
grade bonds, CSJ offers a yield advantage of 56 basis points over SHY.
The search
for yield has put a spotlight on the higher yielding
credits like senior loans and high yield bonds but what about
investment grade credits?
Credit risk is greater
for below
investment -
grade convertible securities.
The inclusion of lower
credit quality
investment grade bonds may introduce additional risk
for the portfolio.
Stock analysts
grade companies every day and give them ratings
for credit worthiness and
investment grade.
Another lesson is that investing
for the average
investment grade credit quality is good also.
Even if Moody's leaves you an
investment -
grade rating, I will tell you that there is not enough buying capacity in the bond market
for crossover
credits of your size.
Names such as Bank of Nova Scotia, CSX, Toyota Motor
Credit and Morgan Stanley
for investment grade issuers and high yield issuer of American Energy Permian Basin, MHGE Parent, Rex Energy and Viking Cruises added to the supply of bonds
for last week.
We prefer U.S.
investment grade bonds against this backdrop of reduced compensation
for credit risk but are neutral on U.S. high yield.