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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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| 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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2 Tips For Investors Considering TIPS |
Seeking Alpha - Oct. 19, 2011 - By Matt Tucker
In a recent post I talked about fixed income ETF distributions and what drives them. Now I am going to delve a little deeper and explore an area of the market that can cause investor confusion — TIPS ETFs and distributions.
As their name implies Treasury Inflation Protected Securities can help protect investors against inflation while also providing the potential for a secure income stream. The payments on TIPS are adjusted according to changes in the Non-Seasonally Adjusted US Urban Consumer Price Index, or CPI. That means the principal of TIPS increases with inflation and falls with deflation, as measured by the CPI.
TIPS are also valued by investors for their historically low correlation with other asset classes, which can make them a good addition to a diversified portfolio.
If you want exposure to TIPS you can buy them directly (the government sells them on TreasuryDirect.gov) or you can purchase TIPS ETFs. But here are two key points to understand before deciding whether TIPS or TIPS ETFs are right for you:
1.) Tax implications. For a taxable US investor, both the bond coupon and the inflation adjustment of TIPS are taxed as income. But the majority of the inflation adjustment is paid when TIPS mature. For a taxable investor this creates what has been coined “phantom income”, income that is taxed in the current period but not received until a later period.
iShares offers two ETFs that invest in the TIPS market — the Barclays TIPS Bond Fund (TIP) and the Barclays 0-5 Year TIPS Fund (STIP). These funds address the phantom income issue by paying out a distribution that includes both the coupon income coming from the underlying TIPS held in the funds as well the adjustment for inflation. The income that an investor is taxed on in the current period is received in the current period. But paying out both coupon income and realized inflation has an interesting impact on the amount of income TIP distributes, which leads me to my second point:
For the complete article.
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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.
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