With inflationary pressures under control and external balances improving, many emerging-market (EM) countries are working on the next item on their to-do lists: reigning in fiscal deficits. That’s good news for emerging equities, dollar-denominated bonds and local-currency debt.
Not long ago, we suggested that investors who wanted to make their equity portfolios less volatile add a dash of high-yield bonds. There’s a similar low-volatility strategy available to high-yield investors: shorten duration and focus on quality.
There’s value and opportunity in European high-yield bonds today. But if you’re considering using an exchange-traded fund (ETF) to tap into the market, you may want to think again.
These are uncertain times in markets, and that creates a dilemma for investors who need high levels of income but can’t stomach a high level of risk. We have a solution. Actually, we have two.
The US credit cycle is entering its ninth year. That doesn’t mean it will end tomorrow. But it will end—and possibly sooner than markets think. Fortunately, there are ways to de-risk and maintain exposure to high-income assets.
Higher interest rates, a stronger dollar and Donald Trump: three reasons to avoid emerging-market (EM) debt? Not necessarily. Rising rates seem to be signaling faster growth, and that’s good news for many EM bonds and currencies.
Instead of sitting on the sidelines in 2017, take a look at Europe’s corporate bond markets. They could prove a beacon of stability in an uncertain world.
Still casting about for a New Year’s resolution? If you’re an income-conscious investor, try this: expect that something unexpected will happen next year and act now to cushion your portfolio.
When the market starts buzzing about rising rates, high-yield bank loans’ popularity grows. Although the bank loan bandwagon may look tempting, we’ve found reasons why high-yield bonds shouldn’t be so easily dismissed.
A pending US interest-rate hike and worries about inflation may have persuaded investors to start avoiding bonds. We think that’s a mistake, especially when it comes to high yield, a sector that often thrives when rates rise.