Sentences with phrase «to reach for yield»
The way to think about it is that investors reached for yield at a time when stocks were in trouble, and indeed, rates went lower.
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Having said this, nearly everyone who comes to me is trying to squeeze income out of low - yielding instruments or reaching for yield by taking a big risk.
To professionals: don't reach for yield now; long - run, you are not getting paid for the risks.
Investors have reached for yield without regard for risk.
In a crisis style event the current reach for yield will become a reach for safety.
I realize that junk bonds are called such for a reason, and that if reaching for yield was a no - brainer prospect then everyone would be doing this.
I continue to favor investment grade income (25 %) over a speculative reach for yield in junk debt.
So many are reaching for yield amid a weak economy with yields that are low relative to past trends.
The recent elimination of foreign content rules in tax - deferred accounts, allows us to reach for yield by setting up a high - interest savings account for the cash portion.
Be careful, and don't reach for yield.
Some investors are reaching for yield in risky places.
When investors reach for yield, the quiet assumption is that the extra yield won't be wiped out by a decline in price.
However, I strongly caution investors against succumbing to the temptation of reaching for yield too aggressively.
While reaching for yield has been successful in the past, we suggest increasing credit quality, increasing liquidity and reducing risk in an environment where the Fed's policy changes introduce a very different forward - looking outlook.
«More money has been lost reaching for yield than at the point of a gun.»
Or am I just reaching for yield?
More from Global Investing Hot Spots: Tesla and China trade war Reaching for yield in this bond sector may be risky
Market Killer When rates are low, investors reach for yield beyond what seems logical, according to a study outlined in The Wall Street Journal, which concluded that if rates rise and investors revert to less risky portfolios, equities could «be in for a big drop.»
He recommends against reaching for yield.
Investment dept @ ins co in 93 was reaching for yield through duration @ wrong time 94 bad year 4 dur Nov 24, 2012
As a Wall Street Journal article pointed out, many bond mutual funds are reaching for yield now.
In general, average retail investors reach for yield at the wrong time, and Wall Street is more than happy to facilitate that through structured notes and other high yielding investments where the risk is greater than the excess yield.
Soon enough, I expect that investors will be relieved of the need to desperately reach for yields that are hardly distinguishable from zero.
As investors reach for yield due to the «hot potato» of zero - interest money created by the Federal Reserve, they seem to believe that they have found a reliable «earnings yield» in stocks.
Reaching for yield always has risks, but the penalties are most intense at the top of the cycle, when credit spreads are tight, and the Fed's loosening cycle is nearing its end.
If you're looking for A properties in a market like that, you're going to get a big pinch in caps since everyone and their Chinese brother - in - law are stepping into secondary markets reaching for yield these days.
Avoid risks of reaching for yield.
For example, investors or portfolio managers dissatisfied with low returns may reach for yield by taking on more credit risk, duration risk, or leverage.
While reaching for yield has been successful in the past, we suggest increasing credit quality, increasing liquidity and reducing risk in an environment where the Fed's policy changes introduce a very different forward - looking outlook.
Unlike Bombardier, we think the ARD deal is a classic late cycle example of investors reaching for yield without considering the downside risk.
We agree with investment writer Ray DeVoe's observation, «More money has been lost reaching for yield than at the point of a gun.»
«People are just reaching for yield.»
Their solution is to reach for yield in things that seem appetizing, without realizing the essential nature of risk and reward.
The investor reach for yield has manifested itself most dramatically in the high yield market as the chart below shows.
Likewise, the opposite effect could take place in markets like munis and corporates where supply has boomed and investors have reached for yield.
The argument for raising rates is that it would help increase financial market stability by putting a damper on investors «reach for yield,» which can be seen everywhere from a bubbly tech sector to plentiful financing for oil exploration companies even as oil prices remain depressed.
He says the actions of central banks «attempting to spark economic growth» are «severely punishing the world's savers and creating incentives to reach for yield, pushing investors into less liquid asset classes and increased levels of risk, with potentially dangerous financial and economic consequences.»
In other words, the combination of a reach for yield, tax incentives, and the belief that default is impossible all contributed to a debt crisis that is likely not going to end well.
Persistence will remain a key feature of markets going forward, as will the reach for yield, we believe.
The lower for longer outlook for Fed rates extends investors» reach for yield, and we see it further supporting EMs.
These rates are an invitation to leverage, to reaching for yield, to financial engineering and to bubbles.
This very low market volatility can lead investors to take on more risk, and in a period of still relatively low interest rates, to «reach for yield» — that is, buy riskier assets than one would otherwise, in order to achieve a desired profit or savings goal.
But reaching for yield can increase your risk even more.
Former Fed Governor Stein have long argued that unconventional programs (QE) would depressed risk - free returns and induce financial institutions to «take added risk» in an effort to «reach for yield.»
When you hear the term «reach for yield,» think: pigs are greedy, hogs get slaughtered.
This issuance has been enabled by the «reach for yield» provoked by zero interest rate policy.
In addition, terms and conditions in the leveraged - loan market, which provides credit to lower - rated companies, have eased significantly, reportedly as a result of a «reach for yield» in the face of persistently low interest rates.
A flattening yield curve highlights Federal Reserve rate hikes» inability to tighten financial conditions, as low long - term interest rates continued to induce institutional investors to «reach for yield» by moving up the risk ladder