The fixed income market saw massive redemptions suffered by the largest fixed income mutual funds over the last several months. The highly visible spokesmen for those funds have appeared in the media with increasing frequency stating and restating their bullish stance, while simultaneously selling bonds to meet rising redemptions. That hefty selling need, approximately $41 […]
“Given the size of this deal and in order to attract a large pool of investors, concession may have to be such so that these bonds have to become profitable pretty soon,” said Michael Kastner, principal at Halyard Asset Management. Verizon set for blockbuster bond sale
“Verizon will be an enormous deal and has the potential to destabilise the market or be the catalyst for a rebound in corporate bond sentiment,” says Michael Kastner, principal at Halyard Asset Management. Blockbuster Verizon bond sale to test debt appetite
Longer term interest rates rose in July as the yield curve continued to steepen, albeit at a slower pace than witnessed in May and June. For the period, the yield-to-maturity of the 10-year note rose 10 basis points to finish the month at 2.58%. The ETF related spread widening that occurred in June and was […]
Michael Kastner, principal at Halyard Asset Management says there is a risk that bond yields rise further as economic growth for the second quarter and the July jobs number is revised upwards. “It looks like the economy has underlying strength and as an investor you have to respect the bond selling we saw in May […]
Michael Kastner, managing principal at Halyard Asset Management, says he is hedging the duration risk in his portfolios from owning longer-dated corporate bonds with interest rate futures. “We are adding exposure across all sectors and see investment grade clawing back some ground on junk,” he says. Investors bet on junk bonds to outperform
Municipal Bonds – Value in a Risky Interest Rate Environment! • Municipal Bonds Attractive Relative to US Treasury Notes – Again • Increase in yield to maturity a welcome development….But the rate is still low! • Targeting AA rated paper as investors sold good bonds into a bad market • Implementing interest rate hedges to […]
As detailed in the last monthly update, we believe the normalization of interest rates has begun, as the vicious bear market witnessed in May continued into June. During the month, the 10-year note reached a high yield of 2.61% before closing the month at a yield-to-maturity of 2.49%. That’s nearly one hundred basis points higher […]
Did fixed income ETF’s sing their swan song yesterday? Maybe not, but after the abysmal performance yesterday, investors must reevaluate the risk and liquidity of an ETF before assuming the product is a cost-effective proxy for a diversified fixed income portfolio. In the midst of the fixed income rout, ETF sponsors found themselves unable to […]
The normalization of interest rates has begun. We’ve warned for some time that Fed-engineered interest rate manipulation would result in investor losses once the central bank ended the practice. May was the beginning of that trend. Comments made by several members of the Federal Open Market Committee suggesting that the Fed was contemplating “tapering” the […]