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| BondsOnline.com: instant access to and extensive coverage of over 3.5 million stocks, bonds, indexes and other securities covering major and emerging markets and exchanges across the globe. |
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| Bonds Online |
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| 5/10/2013Market Performance |
| Municipal Bonds |
|---|
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S&P National Bond Index
|
3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
|
0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| More |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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Bonds: How to Play Interest Rate Peril |
Bloomberg - June 23, 2011 - By David Bogoslaw
With uncertainty high, some bond investors are looking to "unconstrained" managers who take a more active approach to selecting fixed-income securities
Interest rates can turn quickly, as the Greek government learned when its 10-year bond soared more than 9 percentage points in the past year on default worries. Such danger has some fixed-income investors considering a new approach: mutual funds that hold a variety of bonds, including U.S. Treasuries, corporates, mortgage-backed securities, municipals, and senior bank loans. Especially attractive now are multisector funds touting a more active approach to portfolio management, with the flexibility to drift from benchmark allocations to respond to changing market conditions.
Fund tracker Morningstar (MORN) estimates that 22 so-called unconstrained bond funds currently manage a total of $53 billion in assets. That's roughly a quarter of 87 multisector bond funds Morningstar has identified with assets under management totaling around $169 billion. The new breed of fund accounts for just a meager fraction of the $2 trillion held by 1,127 taxable bond funds. Fund flows for 12 of the 22 unconstrained funds have generally trended higher since January, with five funds showing big spikes in April or May as the debate around the U.S. debt ceiling heated up. The strategies of these "go-anywhere" funds aren't uniform. Some focus on reducing their portfolio's average duration (the percentage by which a bond's value is likely to drop for every 1 percent rise in interest rates), while others concentrate on getting the highest yield for the least amount of credit risk.
"Multisector funds have been most popular because people are thinking, 'Is there a bond bubble?'" says Philip Condon, head of municipal bonds at DWS Investments in New York. "Investors recognize that Treasuries probably aren't the best value when you see yields" below 3 percent. "Multisector bond funds are offering the ability to find that value in the marketplace."
The nimbleness of these actively managed funds comes at a price. In place of interest rate risk, they often expose investors to elevated credit risk or, in the case of certain emerging market debt, liquidity risk. And some of these funds charge fees roughly twice as high as funds focused on a specific part of the fixed-income market, although high-yield and short-duration funds also tend to have higher fees. "In general, it's a pretty untested group," says Miriam Sjoblom, a bond fund analyst at Morningstar. "We don't have a long track record of seeing how these funds hold up in different environments."
For the complete article.
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| Stuff to look at |
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
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