Sentences with phrase «higher return on those bonds»

But a higher interest rate means that you could receive a higher return on your bond.

Investors will expect a higher return on those bonds than they get today.

Not exact matches

Analysts who spoke to Reuters on Monday said some of their investor clients want Goldman management to outline a specific plan for how the bank will make up for falling bond revenue and drive returns higher.

«For example, a bond fund may borrow and take on leverage in order to show a higher return but has significantly higher risk than a retiree may want in an income portfolio.»

But it looks like a high probability bet that the spread between the returns on stocks and bonds should be wider in the future than it has been for the past three decades or so.

While stocks are riskier than bonds or cash investments, they have much higher returns over the long run and many issue dividends on top of this.

The Department of Finance attributes the increase in public debt charges due to inflation adjustments on real return bonds and a higher stock of interest - bearing debt.

Given those durations, an investor with 15 - 20 years to invest could literally plow their entire portfolio into stocks and long - term bonds, in expectation of very high long - term returns, with the additional comfort that their financial security did not rely on the direction of the markets, thanks to the ability to reinvest generous coupon payments and dividends.

Based on BlackRock's long - term assumptions, some of the better return - to - risk ratios are in high yield bonds, EM dollar - denominated debt and bank loans.

More interesting is the return on the BofA Merrill Lynch U.S. High Yield Energy Bond index, which has a whopping 18.26 % return YTD, but over the past year still has a negative 15.65 % return.

That's because average stock market returns have been higher than those on bonds and savings accounts over time.

For example, if you're comfortable taking on more risk in exchange for potentially higher returns, your portfolio might be weighted with more stocks than bonds.

For instance, a portfolio with an allocation of 49 % domestic stocks, 21 % international stocks, 25 % bonds, and 5 % short - term investments would have generated average annual returns of almost 9 % over the same period, albeit with a narrower range of extremes on the high and low end.

Moreover, a sustained move toward higher inflation is a risk to most investors and investment strategies, given that rising inflation has historically been a drag on equity and bond returns, making diversification beyond mainstream asset classes more critical.

Considering the high correlation between green bonds and core fixed income, investors have the possibility to reallocate part of their core fixed income allocation to green bonds in order to increase diversification and «green» their portfolio with a minimal impact on the risk / return profile of their portfolio.

Each month, Palhares and Richardson sorted corporate bonds into quintiles based on each liquidity measure and computed the return of a long / short portfolio that buys the least liquid bonds (i.e., smaller issue sizes, higher bid / ask spreads, lower trading volume, higher price impact or higher frequency of zero - trading days) and sells the most liquid bonds (i.e., larger issue sizes, smaller bid / ask spreads, higher trading volume, lower price impact or lower frequency of zero - trading days).

Plenty of actively managed bond funds have veered away from their benchmark and taken on more risk in the pursuit of higher returns.

Thus, if we look at bonds from a historical perspective, interest rates are very low — which is great for those borrowing money — but not so great for those that wish to see higher rates of interest, and return, on their money.

And if you can buy some business that earns high returns on equity and has even got mild growth prospects, you know, at much lower multiple earnings, you are going to do better than buying ten - year bonds at 2.30 or 30 - year bonds at three, or something of the sort.»

Former Fed Governor Stein highlighted that Federal Reserve's monetary policy transmission mechanism works through the «recruitment channel,» in such way that investors are «enlisted» to achieve central bank objectives by taking higher credit risks, or to rebalance portfolio by buying longer - term bonds (thus taking on higher duration risk) to seek higher yield when faced with diminished returns from safe assets.

, but I think it's a mistake for risk averse or diversified investors to completely give up on high quality bonds because they're worried about poor returns from low yields.

For a number of years, concerns had been expressed about the underpricing of risk in a range of financial instruments and the associated search for yield as investors sought higher returns in non-standard financial products as the yield on more standard products such as government bonds was deemed to be inadequate.

You may also be interested in considering High Yield Bond ETFs High Yield Real Estate Investment Trusts (REITs) High Yield Closed End Funds High Yield Utility Stock ETFs Return from High Yield ETFs to More on High Yield Passive Income

These savvy investors picked up Ford bonds for pennies on the dollar and realized double digit returns in the bond price return, with high yield double digit returns to boot.

Investors are banking on much higher returns from equities than bonds again in 2018.

Investment to consider: The interest from municipal bonds is generally free from federal taxes and often state taxes as well, depending on your state or where you file — savings that may potentially translate into higher returns.

By design, the Fed wished to push investors into higher risk assets such as equities and real estate by lowering the return on safe bond investments.

While the returns on money market funds are generally not as high as those of other types of fixed income funds, such as bond funds, they do seek to provide stability, and can therefore play an important role in your portfolio.

But after considering the impact of taxes, the taxable - equivalent yield (the return required on a taxable bond to make it equal to the return of a tax - exempt bond) of municipal bonds was a full percentage point higher, at 3.75 %, for investors in the highest (37 %) tax bracket.

Based on these categories, mutual funds receive rankings based on highest - rated value, highest - rated growth, daily gainers and losers, category of highest and lowest returns, highest - rated large - cap funds, highest - rated mid-cap funds, small - cap funds, high - yield bond funds, high and low risk foreign funds, top year to date performers, analysis of prior year's top performers and...

The Litman Gregory folks started with a common premise: «In the years ahead, we believe there will be mediocre returns and higher volatility from stocks, and low returns from bonds... [we sought] «alternative» strategies that we believe are not highly dependent on tailwinds from stocks and bonds to generate returns.»

Since HY bonds are riskier, investors are compensated with higher returns — more on that later.

High - yield debt in both the US and international bond ETFs also got a boost after yield - seeking investors moved longer on the yield curve and into riskier debt securities to achieve better returns on their investment capital.

Matt Eagan and a team from Loomis - Sayles who are charged with implementing an Absolute - Return Fixed - Income which centers on high - yield and international bonds, with the prospect of up to 20 % equities.

Plenty of actively managed bond funds have veered away from their benchmark and taken on more risk in the pursuit of higher returns.

Many believe this dynamic can go on, since rates are probably going to remain low, creating a still high «equity risk premium» — the likely return from stocks over bonds.

Future high yield bond returns will likely be more muted — and depend more on improving fundamentals than commodity prices.

In this example, even though the total return on the stocks was higher (8 % versus 5 %) the amount of tax payable on the bond holding was significantly greater.

We can (and have) capitalized on a wide range of opportunities in the bond market, including in higher and lower quality bonds, strategic and high - yield bonds, floating - rate securities and even total - return funds, which aren't fully invested in bonds.

On the other hand, adding some stocks and bonds to a portfolio of stable, short - term cash investments could boost the probability of achieving higher long - term returns.

But after considering the impact of taxes, the taxable - equivalent yield (the return required on a taxable bond to make it equal to the return of a tax - exempt bond) of municipal bonds was a full percentage point higher, at 3.75 %, for investors in the highest (37 %) tax bracket.

For example, the annual return on long - term US Treasury bonds is likely to be very different from the return reported for high - yield corporate bonds or general obligation (GO) municipal bonds.

All market neutral funds offer risk reduction strategies but come with a high degree of opportunity cost — returns are generally on par with bond funds.

«If a company's internal rate of return is higher than the interest they pay on their bonds, it's smart for them to issue more debt,» McMahon explained.

On the fixed income side, the Bloomberg Barclays US Aggregate Bond index returned -1.46 %, reflecting concerns of higher rates and higher inflation in the US.

Unlike money saved in a bank account, money saved into Qualified Tuition Programs (QTPs), such as 529s can be invested into stocks and bonds, giving you the chance for a higher return on your savings.

These types of low - rated bonds are the same as the high - yielding and speculative bonds, because they carry the highest risk and can bring the highest return on investment, if they are paid back at maturity.

And while rising rates are bad for bonds and bond funds in the short - term, climbing yields can actually boost returns on a diversified portfolio of bonds over the long haul, as interest income and proceeds from maturing bonds are re-invested at higher rates.

It's difficult to meet financial goals when the rate of return on high - grade bonds is no higher than inflation.

Tobacco settlement bonds are the target of refundings as the high interest rates on older debt can be replaced with lower cost debt via the refunding mechanism helping to drive returns.