Sentences with phrase «term bonds as»

On March 18, the Federal Reserve announced it would purchase up to $ 300 billion of long - term bonds as well as $ 750 billion of mortgage - backed securities.

VCIT defines intermediate - term bonds as those expiring in the next 5 - 10 years, a reasonable position, but one that puts it at odds with our 1 - 10 year benchmark.

They buy short - term bonds as a way to reduce risk (because they are selling stocks), and also as a source of diversification.

Across the spectrum, long term bonds outperformed short term bonds as interest rates mostly held steady.

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.

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.

The bond exposure could be handled similarly by holding short term, intermediate and long term bonds as well as Treasuries.

The «belly» of the curve, or the 5 to 10 year maturity range, is performing as well as longer term bonds as the weighted average Read more -LSB-...]

So he chose stocks for periods of prosperity, cash to keep you afloat in a recession, gold as a hedge against inflation, and long - term bonds as a safety net in times of deflation.

The ECB would engage in potentially unlimited «outright monetary transactions,» meaning that the ECB would buy as many short - term bonds as it takes to keep yields manageable.

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.

Not exact matches

In the short - term, however, this increased leverage may actually be bullish for junk bonds, corporate bonds, emerging market debt and mortgage - backed securities as it brings higher prices and lower yields, he said.

She said those include how much you have in cash for short - term expenses, the way your assets are allocated between stocks and bonds, as well as your spending behavior.

The higher bond yields go, the more pension funds will buy as they look to lock in long - term income streams to meet their liabilities.

The restructuring can be relatively gentle, such as a cut in rate, stretch - out of term, and the loss paid in some form of equity participation bonds in the future growth of the countries.

Alternatively, it's best to shorten the average term to maturity of your bond portfolio as interest rates enter into a rising cycle, because the shorter the term, the less their price will be affected.

For instance, under recent scrutiny are negotiable certificates of deposits (NCD), a kind of short - term bond, and niche products like perpetual notes, a long - term debt instrument that can be listed as equity rather than debt on balance sheets.

Long - term interest rates could rise abruptly, as bond prices fall.

According to Morningstar Direct, $ 59 billion is invested in long - term bond funds and exchange - traded funds (defined as portfolios with average durations above six years).

Funds that own high - quality bonds with shorter durations, such as Fidelity Short - Term Bond, can help reduce your portfolio's sensitivity to rising rates.

While U.S. savings bonds have lost popularity as a means of long - term savings due to the low interest rates they currently earn, some retirees have been holding on to bonds that were issued when rates were higher.

Bonds have historically had little correlation to equities except in market crisis situations, so creating a portfolio of both equities and bonds makes a whole lot of sense as a long - term inveBonds have historically had little correlation to equities except in market crisis situations, so creating a portfolio of both equities and bonds makes a whole lot of sense as a long - term invebonds makes a whole lot of sense as a long - term investor.

This increase in bond ownership can push prices up, and further depress long - term yields, which fall as prices rise.

Although the retailers have been negotiating with bond holders, who have accepted significant discounts and offered longer terms, the basic financials are enough for Moody's to rate 13.5 percent of the retailers it follows as a Ca or Caa credit risk.

That market participants have finally come to terms with the Federal Reserve's normalization plans is just one of the reasons short - term bonds are finally looking attractive again after years in the doldrums, as we explain in our new Fixed income strategy A mighty (tail) wind.

Certainly, it offers an attractive level for longer - term investors such as pension and insurance funds to lock in a relatively decent yield, and will tempt some portfolio managers to buy bonds rather than equities.

We said long - term bond prices could fall as much as 10 %.

Yield to maturity is considered a long - term bond yield, but is expressed as an annual rate.

In fact, long - term bonds and preferred shares have characteristics that make them a very useful asset class for retirement portfolios, as I explain in my essay Security of Income vs. Security of Principal.

As you can see in the chart below, based on investment performance for the 35 - year period beginning in 1972, a hypothetical balanced portfolio of 50 % stocks, 40 % bonds, and 10 % short - term investments would have done quite well for a retiree who limited withdrawals to 4 % annually.

As a result, the PH&N Total Return Bond Fund, a fund that seeks to provide long - term growth and a consistent level of income, was a preferred choice this past month.»

There is no doubt that, based on pure, cold, logical data, stocks are the single best long - term performing asset class for disciplined investors who are not swayed by emotion, focus on earnings and dividends, and never pay too much for a stock, often as measured on a conservative beginning earnings yield relative to the Treasury bond yield basis.

As your child grows older, your money shifts to increasingly conservative portfolios that have higher concentrations in bonds and cash (short - term investments).

This is especially true for those investors who look to their bond funds as a source of long - term income.

As Russ Koesterich points out, cash typically produces lower returns than stocks or bonds, and once you invest for both inflation and taxes, average long - term rates are negative.

Although commercial banks mostly rely on capital from deposits from customers, such banks may issue notes and bonds as long - term capital resources.

We view long - term government bonds as useful diversifiers against volatility and equity market selloffs sparked by such shocks.

With extraordinary low interest rates and modest inflation, investing in long - term bonds to capture as much yield as possible may seem like a smart move.

The earnings yield on enormous blue - chip stocks such as Wal - Mart, which had little chance to grow at historical rates due to sheer size, was a paltry 2.54 % compared to the 5.49 % you could get holding long - term Treasury bonds.

Consequently, the price of a long - term bond would drop significantly as compared to the price of a short - term bond.

Investors in Treasury notes (which have shorter - term maturities, from 1 to 10 years) and Treasury bonds (which have maturities of up to 30 years) receive interest payments, known as coupons, on their investment.

Long - term bond yields continue to extend their hostile upward trend, while other market internals continue to diverge as well.

On the other hand, if you'll need the money in just a few years — or if the prospect of losing money makes you too nervous — consider a higher allocation to generally less volatile investments such as bonds and short - term investments.

We assumed that in each period a 30 - year bond is issued at prevailing interest rates (long - term government bond plus 1 %) and that amount is invested for the next 30 years in a portfolio of large - cap stocks while paying off the bond as an amortized loan (as if it were a mortgage).

As long - term investments, many factors that roil the stock or even broader bond markets don't affect high yield, the panelists pointed out.

The slated deal comes as Lynas progresses talks with Mt Kellett and the other 9 convertible bond holders, including Fortress Investment Group, about amending the terms of the bond facility and extending the maturity.

But if you're holding Bond ETFs such as iShares XBB (mid-term maturities) or XSB (short - term maturities), then the prices of these ETFs will fall when rates go up.

While she expected that bond yields might not fall too much near term as managers would need to allocate some funds to cash bonds, swaps and futures would likely remain under pressure.

And even if the indicator was valid (counterfactually), the article asks readers to accept as given that earnings are properly reported here, that they will grow by nearly 50 % over the coming year, and that investors are willing to key the long - term return they require from stocks to the yield on 10 - year bonds, which has been abnormally depressed in a flight to safety.

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.