Sentences with phrase «term bond purchases»

While I don't presume to read traders» (or trading computers») minds (see Barry ritholtz» note this morning about ex post facto rationalizations), generally speaking there is concern that the «taper» of long term bond purchases will cause bond yields (the percent of interest paid on them) to rise.

The benefit of staggering your long - term bond purchase is that even though all your bonds will mature during the same period, as you are purchasing the bonds at different periods, you will be able to get around the times when interest rates are high and bond values and low and buy bonds when there are no risks.

Not exact matches

That data raised a fresh round of questions about how the Federal Reserve will proceed on further cutting back on its massive monthly bond purchases, which have kept long - term rates low and encouraged a strong rally on equity markets.

The term refers to a central bank using newly created money to purchase government bonds and other securities.

Sure, target - date plans are conservative from a wealth perspective because you typically start off with more stock and slowly unload it, which results in purchasing more short - term bonds as retirement looms.

Residential real estate had taken on a healthy pace in late 2012 and early 2013 but has slowed since the Federal Reserve started talking about reducing its monthly bond purchase, which helps keep long - term interest rates low.

If you purchase an individual bond with a five year maturity you will receive interest payments for the term of the bond along with total principal repayment at maturity.

The institutions are not only using the money to meet their own short - term financing needs, they are also borrowing additional money to purchase the bonds of troubled countries and earn the spread between the yields on those bonds and the much lower rate the ECB is charging them for money.

Together with earlier announced bond purchases, the Fed's move will increase «holdings of longer - term securities by about $ 85 billion each month through the end of the year,» the Fed announced Thursday.

For investors seeking long - term total returns, primarily in the U.S. Treasury market, with added emphasis on the protection of purchasing power through inflation hedges such as precious metals shares and other bond - market alternatives.

But long - term government bond yields fell to record lows for many euro area countries after a speech by ECB President Draghi on 21 November, which stressed that the ECB will do what is required to raise inflation and inflation expectation by adjusting the size, pace and composition of asset purchases, if the currently announced policies prove to be insufficient.

Long - term bond prices fell on disappointment that the Fed will concentrate its purchases in the five - to - six - year maturity area, rather than in longer - dated bonds.

«When I purchased long - term zero - coupon bonds in the early 1980's at market yields in excess of 13 %, I welcomed the prospect of outsized volatility because I felt it would eventually work in my favour.»

Long - term rates have risen since Chairman Ben Bernanke said in June that the Federal Reserve could begin trimming its bond purchases later this year if the overall economy and the job market kept improving.

The bond purchases have helped keep long - term borrowing rates low.

While I think there is some merit in currency matching specific and perhaps shorter - term liabilities via your investment portfolio, I think such matching is better done through the purchase of government bonds in your home currency.

I realize that if the private sector credit creation mechanism is not functioning properly, QE purchases can overwhelm the expected supply response, but it is a mistake to assume that since the Federal Reserve is buying bonds then longer - term yields must be artificially suppressed.

Of course since they also get that additional $ 100 return on their purchase when then bond term ends, so their total return is even better than the 5.6 %.

A less accommodative Fed removes one prop from the bond market, but the reduction in purchases is dwarfed by the likely increase in global savings, i.e. there are plenty of private sector buyers looking to hedge long - term liabilities.

Under Powell's predecessors, Janet Yellen and Ben Bernanke, the Fed's board endured criticism from House Republicans over its decision to pursue a bond purchase program designed to lower long - term borrowing rates and to leave its key rate at a record low near zero for seven years.

Treasury surpluses necessitate open market bond purchases «Under the terms of the law establishing the independent treasury,» Kinley describes, «the Government was expected to keep its own money and have no connection with the banking institutions of the country.»

Outright Monetary Transactions are a bond - buying program announced in September 2012 in which the European Central Bank would offer to purchase eurozone countries» short - term bonds in the secondary market to bring down the market interest rates faced by countries subject to speculation that they might leave the euro.

By purchasing massive amounts of high - risk MBS and long - term government bonds, the Fed helped lower longer - term interest rates but steered credit away from private investment, which was also impeded by stricter macro-prudential regulations.

In order to stimulate the economy further, the central bank has engaged in quantitative easing (QE) or the purchase of U.S. treasury bonds and mortgage debt in order to drive down long - term interest rates as well.

Bernanke had pushed the central bank to drop its key short - term interest rate to near zero and purchased trillions of dollars of government bonds to lower long - term rates.

The district did address long - term finance issues by unanimously approving a resolution to purchase municipal bonds.

It's injected into the bond market when the Federal Reserve purchases mortgage - backed securities and long - term Treasury securities from other financial institutions.

ALBANY — Governor Andrew Cuomo vowed early in his administration to curb New York's practice of borrowing for short - term equipment purchases, arguing instead that the state should only bond for assets when their useful life is longer than the repayment term.

If an investor expects interest rates to increase, she will most likely purchase a bond with a shorter term to maturity.

Once they get to within 4 or 5 years of the purchase they might want to be 100 % cash or short term bonds.

The Fed is set to end its bond purchases in October and most economists expect the first short - term rate hike by mid-2015.

The bond purchases have helped keep long - term interest rates low to encourage more borrowing and spending.

In those accounts many invest in bonds or raise their cash reserves, buy US Treasuries, short term bond funds, or purchase a well managed bond fund like Dodge and Cox Income Fund or Fidelity's Total Bond Fund for exambond funds, or purchase a well managed bond fund like Dodge and Cox Income Fund or Fidelity's Total Bond Fund for exambond fund like Dodge and Cox Income Fund or Fidelity's Total Bond Fund for examBond Fund for example.

Outright Monetary Transactions are a bond - buying program announced in September 2012 in which the ECB would offer to purchase eurozone countries» short - term bonds in the secondary market to bring down the market interest rates faced by countries subject to speculation that they might leave the euro.

The new institution was authorized to issue bonds and use the proceeds to purchase FHA mortgages from lenders, with the objectives of increasing the supply of mortgage credit and reducing variations in the terms and supply of credit across regions.»

The stock and bond funds can provide long - term growth to help maintain your purchasing power over the course of a long retirement and also act as a source of liquidity for any additional spending money you need.

In other words, a portfolio of T - Bills and high - quality, short - term bonds may provide stability of wealth, but may fail to provide stability of income purchasing power.

A land contract, also called a land sale contract, installment contract, contract for deed, a bond for title, or articles of agreement for warranty deed, is a purchase contract where the seller keeps legal title during the terms of the contract.

But history has shown that a simple mix low - cost stock and bond funds has been able generate sufficient returns in excess of inflation to maintain the purchasing power of your savings over the long term.

For investors seeking long - term total returns, primarily in the U.S. Treasury market, with added emphasis on the protection of purchasing power through inflation hedges such as precious metals shares and other bond - market alternatives.

Depending on the goal of purchasing the bond, long - term bonds could be beneficial.

Last month the Bank of Japan (BoJ) introduced a novel plan to target the 10 - year Japanese government bond yield, shifting its focus from bond purchases to a long - term rate peg.

Of course, there are benefits of purchasing short - term bonds as well, so it's good to learn more about how bonds work before buying either type.

In October 2014, we came to the end of the Fed's Quantitative Easing program, a process intended to keep long term interest rates low though the purchase of Treasury Bonds and to keep mortgage credit flowing at low rates though the purchase of agency - issued Mortgage - Backed Securities (MBS).

A person might purchase longer term bonds as a retirement investment, with a more favorable rate, assuming the economy is experiencing a normal yield curve during this time.

For example, a person may purchase a shorter term bond in the event that he needs the capital soon to fund his children's tuition.

For certain individuals, it may be more prudent to purchase a term life insurance policy with lower premiums for a fixed amount of time and take the difference in savings between the two policies and invest in different types of stocks, bonds and mutual funds which may lead to higher returns and a more diversified portfolio.

The Par Value or Face Value is a term used to define the principal value of each bond, which means the amount you had paid while purchasing the bond.

I have a doubt Investing in Mutual Fund.I had Purchased a Land for 2.5 Lakhs in the year 2007 and had sold in the year 2015 for 35 Lakhs.My Long term capital gain is around 30 Lakhs and after Indexation it is around 6 Lakhs, which i had to Pay as Income tax.I require solutions for 3 Questions 1st question.Is it advisable to Purchase NHAI / REC Capital Bonds for 30 lakhs, hold it for 3 years and then invest in Mutual Funds for next 4 years.

In the case of bonds, as you are just lending money to the company or government, you are actually not becoming a part of it and hence the investment you made in terms of bond is not affected by the rise or fall in the company's value and at the end of the maturity date, you will receive back the amount you invested while purchasing the bond.