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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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Fidelity's Junk-Bond King Notkin Adds Stocks as Debt Rally Dies |
Bloomberg.com - Nov. 17, 2010 - By Charles Stein
Fidelity Investments’ Mark Notkin, whose high-yield mutual fund beat all rivals over the past five years, said the rally in junk bonds is over and stocks are a better buy.
The manager of the $12.8 billion Fidelity Capital & Income Fund is putting more money into equities and leveraged loans while cutting back on high-yield bonds, which have soared 80 percent since the start of 2009.
“I don’t see the value in the high-yield market,” Notkin said in an interview at his Boston office. “You are not being paid to take risk.”
Corporate junk bonds climbed last year after the U.S. recession ended and the default rate fell. Investors added $55.1 billion to U.S. junk-bond funds in 2009 and this year through September, according to Cambridge, Massachusetts-based research firm EPFR Global. Withdrawals from U.S. equity funds were $129.9 billion in the same period.
It’s time to shift gears because equities offer bigger gains, said Margaret Patel, who oversees about $1 billion for Wells Fargo & Co. in two mutual funds that invest in both asset classes. Notkin’s fund, which can keep as much as 20 percent of assets in stocks, had 17 percent in equities at the end of September, according to Fidelity’s website.
“The pendulum has swung from high yield to equities,” Patel said in a telephone interview from Boston.
Patel said that as earnings rise for companies tied to the global economy over the next 12 months, stocks are likely to deliver more than the 6 percent to 7 percent gains she expects from junk bonds.
Low Yields
Junk-bond yields that are low by historical standards and the prospect of increasing interest rates will limit gains, Patel said. Firms that issued high-yield securities in the past three to five years may buy back outstanding bonds because the debt can be refinanced at lower rates, she said.
Speculative grade, or junk, bonds, are rated Ba1 or below by Moody’s Investors Service and BB+ or below by Standard & Poor’s.
High-yield bonds could outperform stocks if the U.S. economy slows, said Patel, because companies would still be able to pay their debts even as profits slump.
Notkin, 46, joined Fidelity in 1994 as a high-yield analyst covering broadcasting, gaming and lodging. He earned a bachelor’s degree from the University of Massachusetts and a master’s of business administration from Boston University.
For the complete article visit Bloomber
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