Sentences with phrase «rising interest rate risk»

Several studies [1][2] have shown that low volatility portfolios have exposure to rising interest rate risk.

When rates are rising interest rate risk is higher for lenders since they have foregone profits from issuing fixed - rate mortgage loans that could be earning higher interest over time in a variable rate scenario.

Not exact matches

In its latest Annual Report, it argued that «even if inflation does not rise, keeping interest rates too low for long could raise financial stability and macroeconomic risks further down the road, as debt continues to pile up and risk - taking in financial markets gathers steam.»

If interest rates rise and push that risk - free rate of return higher, then those dividend stocks and high - yield bonds are vulnerable.

YELLOWKNIFE, Northwest Territories, May 1 - Bank of Canada Governor Stephen Poloz said on Tuesday that the view of the Canadian economy is quite good despite record levels of household debt, and he was confident the central bank can manage the risk of that debt even as interest rates rise.

«Gold is stuck between $ 1,238 - $ 1,260 with the risk to skewed to downside based on rising expected interest rates and failure to break higher which has left it vulnerable to profit - taking in the short term,» said Ole Hansen, the head of commodity strategy at Saxo Bank.

Such risks, uncertainties and other factors include, without limitation: (1) the effect of economic conditions in the industries and markets in which United Technologies and Rockwell Collins operate in the U.S. and globally and any changes therein, including financial market conditions, fluctuations in commodity prices, interest rates and foreign currency exchange rates, levels of end market demand in construction and in both the commercial and defense segments of the aerospace industry, levels of air travel, financial condition of commercial airlines, the impact of weather conditions and natural disasters and the financial condition of our customers and suppliers; (2) challenges in the development, production, delivery, support, performance and realization of the anticipated benefits of advanced technologies and new products and services; (3) the scope, nature, impact or timing of acquisition and divestiture or restructuring activity, including the pending acquisition of Rockwell Collins, including among other things integration of acquired businesses into United Technologies» existing businesses and realization of synergies and opportunities for growth and innovation; (4) future timing and levels of indebtedness, including indebtedness expected to be incurred by United Technologies in connection with the pending Rockwell Collins acquisition, and capital spending and research and development spending, including in connection with the pending Rockwell Collins acquisition; (5) future availability of credit and factors that may affect such availability, including credit market conditions and our capital structure; (6) the timing and scope of future repurchases of United Technologies» common stock, which may be suspended at any time due to various factors, including market conditions and the level of other investing activities and uses of cash, including in connection with the proposed acquisition of Rockwell; (7) delays and disruption in delivery of materials and services from suppliers; (8) company and customer - directed cost reduction efforts and restructuring costs and savings and other consequences thereof; (9) new business and investment opportunities; (10) our ability to realize the intended benefits of organizational changes; (11) the anticipated benefits of diversification and balance of operations across product lines, regions and industries; (12) the outcome of legal proceedings, investigations and other contingencies; (13) pension plan assumptions and future contributions; (14) the impact of the negotiation of collective bargaining agreements and labor disputes; (15) the effect of changes in political conditions in the U.S. and other countries in which United Technologies and Rockwell Collins operate, including the effect of changes in U.S. trade policies or the U.K.'s pending withdrawal from the EU, on general market conditions, global trade policies and currency exchange rates in the near term and beyond; (16) the effect of changes in tax (including U.S. tax reform enacted on December 22, 2017, which is commonly referred to as the Tax Cuts and Jobs Act of 2017), environmental, regulatory (including among other things import / export) and other laws and regulations in the U.S. and other countries in which United Technologies and Rockwell Collins operate; (17) the ability of United Technologies and Rockwell Collins to receive the required regulatory approvals (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the merger) and to satisfy the other conditions to the closing of the pending acquisition on a timely basis or at all; (18) the occurrence of events that may give rise to a right of one or both of United Technologies or Rockwell Collins to terminate the merger agreement, including in circumstances that might require Rockwell Collins to pay a termination fee of $ 695 million to United Technologies or $ 50 million of expense reimbursement; (19) negative effects of the announcement or the completion of the merger on the market price of United Technologies» and / or Rockwell Collins» common stock and / or on their respective financial performance; (20) risks related to Rockwell Collins and United Technologies being restricted in their operation of their businesses while the merger agreement is in effect; (21) risks relating to the value of the United Technologies» shares to be issued in connection with the pending Rockwell acquisition, significant merger costs and / or unknown liabilities; (22) risks associated with third party contracts containing consent and / or other provisions that may be triggered by the Rockwell merger agreement; (23) risks associated with merger - related litigation or appraisal proceedings; and (24) the ability of United Technologies and Rockwell Collins, or the combined company, to retain and hire key personnel.

Government bonds could help reduce default risk, but because of the length of maturity required to earn any meaningful yield, they do little to reduce duration risk - i.e. the overall sensitivity of a portfolio to interest rate rises.

«In a bond mutual fund, you're invested in a pool of bonds with no set maturity date, which means more risk if interest rates rise.»

Meanwhile, the spread between riskier «junk» corporate bonds and «risk - free» U.S. Treasurys has dropped since the election even though interest rates generally are rising.

We believe that the downside risk is that the economy enters a period of «overheating» characterized by rising inflation and higher interest rates.

Lower yields and longer maturities present greater risk when interest rates are on the rise.

While it's still not known when interest rates will go up and by how much, what we do know is that the bond market is at greater risk to rising interest rates than at any time in recent history.

The fact that rates have been so low for so long, but are rising at the moment, has investors really nervous about interest rate risk.

A fixed rate loan offers stability and certainty, while variable and hybrid rate loans offer potential cost savings for those who are willing to take the risk of the interest rates rising.

We think investors should be buying dips (risk - on) and the rise in interest rates, in our view, is a reflatio...

In terms of the interest rate risks, It's more of an opportunity cost than a real «hit from rising interest rates», assuming you hold to maturity.

Since bond prices fall as interest rates rise, this possibility has many investors worried about their exposure to interest rate risk.

The tail - end of this period saw rapidly rising inflation and interest rates, but it's worth noting that the risk premium hasn't always been quite so narrow (stocks were up 10.5 % per year in that time).

Main risks: Rising interest rates could push bond prices down, and the bond's issuer could default.

However, there is the risk that the variable interest rate will be much higher if the average student loan interest rate has risen significantly after the set period of time is over.

In a rising interest rate environment, the risk that investors have in owning all bond mutual funds and / or bond ETFs for their bond allocation is that both vehicles are managed on a relative return basis versus a benchmark index.

Although risks remain, the fear of rising interest rates dampening homebuying activity has sent Toll Brothers stock to a bargain price.

This makes sense given how bonds are structured, but I think many investors miss this point when they worry about the potential risks from rising interest rates.

I can see the risk if you intend to sell and interest rates rise, but buy and hold seems to be pretty low risk — unless the dollar becomes defunct, of course.

Yet another critical factor is often overlooked in explanations of low interest rates: a structural rise in risk aversion and savings over the past two decades.

In return for this lower rate, the borrower must accept the risk that the interest rate on the loan most likely will rise in the future, thereby increasing the number of monthly mortgage payments.

Treasury Inflation - Protected Securities (TIPS) are subject to interest rate risk, especially when real interest rates rise.

Although bonds generally present less short - term risk and volatility than stocks, bonds do contain interest rate risk (as interest rates rise, bond prices usually fall, and vice versa) and the risk of default, or the risk that an issuer will be unable to make income or principal payments.

The partners do assume risk because, as owners, they share in losses as well as profits — and this year has been a tough one for Goldman and the rest of Wall Street, as rising interest rates brought spectacular trading losses.

But you are also correct as interest rates rise competing vestments will do just as good if not better for less work and perhaps less risk.

Fixed income investments entail interest rate risk (as interest rates rise bond prices usually fall), the risk of issuer default, issuer credit risk and inflation risk.

If you're having a difficult time handling the potential risks from rising interest rates, it could make sense to have your safe bucket in cash as opposed to bonds.

You take a big risk with variable interest rates, because if rates rise, your loan rate — and your payments and the total interest you pay — can increase substantially.

The KraneShares E Fund China Commercial Paper ETF is subject to interest rate risk, which is the chance that bonds will decline in value as interest rates rise.

Unfortunately, corporate debt relative to U.S. GDP has now returned to prerecession levels, a risk made even riskier by rising interest rates.

Interest rate risk If interest rates rise, the price of existing bonds usually dInterest rate risk If interest rates rise, the price of existing bonds usually dinterest rates rise, the price of existing bonds usually declines.

We could take the $ 16 billion we have in cash earning 1.5 % and invest it in 20 - year bonds earning 5 % and increase our current earnings a lot, but we're betting that we can find a good place to invest this cash and don't want to take the risk of principal loss of long - term bonds [if interest rates rise, the value of 20 - year bonds will decline].»

REITs, especially mortgage REITs, are also subject to interest rate risk (i.e., as interest rates rise, the value of the REIT may decline).

Investments in asset backed and mortgage backed securities are subject to prepayment risk which can limit the potential for gain during a declining interest rate environment and increases the potential for loss in a rising interest rate environment.

The risks associated with bond investments include interest rate risk, which means the prices of the fund's investments are likely to fall if interest rates rise.

Consider these risks before investing: The value of securities in the fund's portfolio may fall or fail to rise over extended periods of time for a variety of reasons, including general financial market conditions, changing market perceptions, changes in government intervention in the financial markets, and factors related to a specific issuer, industry, or sector and, in the case of bonds, perceptions about the risk of default and expectations about changes in monetary policy or interest rates.

Then there's Stephen Poloz, the Bank of Canada governor who has a precarious decision to make: keep pace with rising U.S. interest rates and risk growth — not to mention driving up interest costs for heavily indebted households — or stand pat and risk a collapsing loonie.

Mortgage - and other asset - backed investments carry the risk that they may increase in value less when interest rates decline and decline in value more when interest rates rise.

(Longer - term bonds risk a price decline if U.S interest rates should rise.)

This economic impact works in opposition to the interest rate risk they face: rising rates, which are bad for bonds generally, usually accompany a strong economy, which is good for high - yield bonds; falling rates, which are good for bonds overall, usually accompany a weak economy, which is bad for high - yield bonds.

(Longer - term bonds risk a domestic dollar - price decline if U.S interest rates should rise.)

We have to consider why interest rates could rise and how each risk factor would be affected.

Duration Risk: If interest rates do ever decide to rise, duration will be the most important statistic for bond investors to pay attention to.

Bonds are subject to the risk that an issuer will fail to make payments on time and that bond prices will decline because of rising interest rates or negative perceptions of an issuer's ability to make payments.