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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)
|
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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In Search Of Fixed Income: Favoring Corporate and Municipal Debt Over Treasuries |
Seeking Alpha - Oct. 25, 2011 - By Russ Koesterich
In today’s low rate environment, many investors are looking for fixed income opportunities. As I’ve discussed in the past, for long-term investors, I favor corporate and municipal bonds over Treasuries.
Here are two reasons why I like corporate debt:
Yield: Corporate bonds currently offer a rich yield relative to US Treasuries. Today, the spread between an index of Moody’s Baa-rated bonds and the 10-Year Treasury is 330 basis points, roughly twice the sixty-year average.
Strong Balance Sheets: At the same time that corporate yields are high relative to Treasuries, corporate America’s balance sheet looks exceptionally strong. US companies are holding more than $2 trillion in cash, which represents roughly 7% of company assets and the highest level since 1963.
Here are also two reasons why I like munis:
Yield: First, similar to corporate bonds, municipals currently provide a rich, after-tax yield versus Treasuries of a similar duration. An index of national long duration GO bonds is yielding roughly 3.8%. On a tax adjusted basis, that’s roughly equivalent to a 6% yield for a theoretical taxpayer in the 35% bracket.
Unfounded Dire Predictions: Plus, while munis potentially offer investors a significant pickup in yield, I don’t believe investors in munis are taking on much more risk. As I’ve stated in the past, some of the more dire predictions for munis have turned out to be unfounded. Last December, we all heard predictions that 2011 would see hundreds of billions of dollars in defaults. Year-to-date, municipal defaults are running at less than $1 billion.
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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