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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
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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
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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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Two Income Generating Ideas |
BondsOnline, August 3, 2010
Here are two ideas for generating income for your portfolio.
Selective use of “step-up” bonds: Callable step-up notes are a type of fixed-income security which features a coupon that adjusts to predetermined levels at fixed dates. A call provision is embedded in the bond, which allows the issuer to call, or redeem, the investor’s principal after a certain date. For investors concerned about the low yields currently offered by fixed-income products, as well as the prospects for rising interest rates, callable step-ups offer two main benefits. First, issuers of callable step-up notes reward investors with above-market coupon rates in the initial years in exchange for the right to call the security at some point in the future. This allows investors to achieve a somewhat higher rate of return relative to fixed rate notes of similar maturities in the near term. In addition, as the coupon of the security steps up over time, investors are rewarded with higher income in future years if the bonds are not called.
Like all corporate bonds and agency bonds, callable step-up notes have certain risks, including credit risk and call risk.
Master Limited Partnerships (MLPs): MLPs are limited partnerships that issue investment units which are listed on public exchanges. As a group, MLPs can offer investors significant income, capital appreciation potential and tax-deferral advantages. In addition, MLPs typically feature compelling cash distribution yields to investors, most commonly ranging between 6% and 8%. In order to enjoy the tax benefits of a limited partnership, MLPs may only engage in certain types of business; most are in energy-related fields. Midstream energy transportation, often pipelines carrying natural resources such as oil and gas, are highly regulated industries that dominate the MLP space. Since MLPs typically engage in activities that generate significant cash flow and are structured as partnerships, they generally pay a large portion of their returns in the form of quarterly distributions.
Taxation of MLPs is unique – as a rule of thumb, more than 70% of distributions are tax-deferred until the sale of the partnership units, though all distributions are taxed as ordinary income regardless of when that income is realized. Investors who are willing to accept equity-like volatility should consider selective exposure to MLPs in order to enhance their portfolios with tax-advantaged income.
For more on MLPs, see PreferredsOnline, www.epreferreds.com
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| Partner Market Place |
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| Stuff to look at |
Yield and Income Newsletter: A must have for income investors. subscribe NOW
S&P Commentary and Newsletters: S&P
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
Keep up with monthly, in-depth coverage of fixed income market strategies, commentary, and insights as seen by our sources. Sign up for the free BondsOnline Advisor now!
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