YOUR FINANCIAL FUTURE

Size: px
Start display at page:

Download "YOUR FINANCIAL FUTURE"

Transcription

1 YOUR FINANCIAL FUTURE January 2013 In This Issue Outlook 2013 The Path of Least Resistance In 2013, many different forces will combine to influence the direction of the markets to follow the path of least resistance leading to modest single-digit returns in the U.S. stock and bond markets. Bond Market Perspectives Week of December 17, 2012 Pam Flournoy, CFP Flournoy Wealth Management Financial Advisor 1165 Lincoln Avenue, Suite 330 San Jose, CA Fax: ment.com CA Insurance Lic# 0E58750 On a longer term basis, we find municipal bonds one of the more attractive high-quality bond options, and in what is likely to be a low-return environment going in 2013, such pullbacks may provide opportunity.

2 2 Outlook 2013 The Path of Least Resistance Dear Valued Investor, In 2013, many different forces will combine to influence the direction of the markets to follow the path of least resistance leading to modest single-digit returns in the U.S. stock and bond markets.* The path for the year may be set at the end of 2012, or in early 2013, as policymakers implement critical decisions. We foresee three potential paths in the year ahead. Our base case path is supported by our view that key decision makers will find it is better to determine a way to overcome an avoidable and unnecessary economic recession, buy time to actually propose and vote on competing long-term fiscal visions, and do something to help restore confidence in Washington's ability to govern. However, there are paths that differ from this base case outcome: a bear path where the consequences of fiscal contraction damage confidence as well as the economy, and a bull path where an historic opportunity to address the U.S.'s long-term fiscal challenges is embraced and leads to sustainable solutions. Which of these three is the path of least resistance is likely to be determined by the end of the first quarter of Please enjoy the enclosed Outlook 2013 that provides a comprehensive perspective on the markets and the economy -- with a focus on the path of least resistance -- and the many factors that will influence them in the year ahead. IMPORTANT DISCLOSURES The economic forecasts set forth in the presentation may not develop as predicted and there can be no guarantee that strategies promoted will be successful. *Equity market forecast is for the S&P 500 Index and is based upon a low-single-digit earnings growth rate supported by modest share buybacks combined with 2% dividend yields and little change in valuations. Bond market forecast is for the Barclays Aggregate Index and is based upon a less than one percentage point rise in rates, with price declines offset by interest income. This research material has been prepared by LPL Financial. Tracking # Exp. 12/13

3 3 Bond Market Perspectives Week of December 17, 2012 Highlights Several factors combined to spark a notable municipal bond market sell-off last week. Pressures may persist over coming days, including many seeking to sell after recent gains and poor year-end liquidity. On a longer term basis, we find municipal bonds one of the more attractive high-quality bond options, and in what is likely to be a low-return environment going in 2013, such pullbacks may provide opportunity. Early Lump of Coal for Municipal Bonds After presenting investors with good returns for much of 2012, the municipal bond market handed investors an early lump of coal last week. The Barclays Municipal Bond Index declined 0.8%, the worst weekly decline in just over a year. There was no "naughty" behavior to single out. Defaults among municipal issuers remain isolated and continue to decline, and valuations remain attractive relative to Treasuries on a longer term basis. Nonetheless, several factors combined to spark a sell-off and a difficult week for municipal bond investors. Heavy new issuance. One of the largest weeks of new bond supply in 2012 was the primary catalyst for municipal bond weakness. More than $11 billion in new issuance was scheduled to come to market but met weak demand. Bond dealers, who typically get conservative as year-end approaches, cut prices sharply to avoid holding excess inventory. Strong recent performance. The tepid response to new issuance was likely exacerbated by recent strong performance, and investors held back. Since the November 6, 2012 election, the municipal bond market outperformed Treasuries by nearly 1.0%, according to Barclays Index data. To illustrate, from November 6, 2012 through December 7, 2012, the average AAA-rated 10-year municipal bond yield declined by 0.24% compared to the 0.13% decline of the 10-year Treasury yield. Record-low yields. Along with strong performance came higher prices and record-low yields. Record-low yields hindered investor demand just when the market needed to help absorb hefty supply. Record-low yields gave investors reason to hesitate-or simply wait on the sidelines. Increased talk of a 28% cap. News reports suggested that a 28% cap on all allowable exemptions (mortgage interest, state and local taxes paid, and of course municipal bond interest income), was gaining traction in Washington as fiscal cliff negotiations continued. Capping the tax exemption of municipal interest income would make municipal bonds less attractive relative to other fixed income investment choices and gave investors contemplating a sell one more reason to do so. Surge in secondary market sells. All of the above factors led to a surge in bonds for sale [Figure 1]. The five-day moving average of the par value of bonds seeking sale (known as "bid-wanteds" in the marketplace) surged to levels not seen since Meredith Whitney's negative comments on municipal bonds in late Whitney predicted a wave of defaults possibly totaling $100 billion leading to a sharp sell-off, but the default wave never came remotely close to materializing. The recent sell-off is on pace to be the worst of 2012, exceeding pullbacks in March and June of this year. Treasury market weakness, also a factor in the current sell-off, combined with seasonal tax-related selling and then record-low yields drove the March 2012 pullback. June witnessed a more modest sell-off related to a seasonal surge in issuance at the start of the month. In the coming days, we believe additional modest weakness may persist due to the large amount of bonds in the secondary market looking to be sold. In addition, with year-end approaching, most bond dealers get conservative, and their support of the market is likely to be limited. Furthermore, the municipal bond market,

4 4 as measured by the Barclays Municipal Bond Index, is still up over 7% year-to-date through last Friday, December 14, 2012, and may spark additional profit taking on what is still a good year relative to the broad taxable bond market, up 4.2%, and Treasuries, up 2.1%, both according to Barclays Index data. On a positive note, new supply drops off sharply over the remainder of the year and the first week of January. This week, less than $3 billion is scheduled to come to market versus $11 billion last week, and the Christmas and New Year's holiday weeks should see extremely limited issuance. We believe the bulk of weakness may be behind us due to the sharp drop in new issuance, but stabilization may be the best investors can anticipate in the coming days. A bounce back is unlikely, given illiquid trading conditions that are likely over the coming two weeks as a result of the Christmas and New Year's holidays. Importantly, unlike the late 2010/early 2011 sell-off, widespread default fears that ultimately proved to be widely misguided are not behind the current sell-off. Supply-related sell-offs do occur in the municipal bond market but can give way to opportunity. Over the past five years, a period that includes the financial crisis and Great Recession, the municipal market has experienced a pullback of 0.7% or more over five trading sessions (one week) many times. Our analysis of daily return data for the Barclays Municipal Bond Index over that time frame indicates that the median return over the subsequent 20 days (four weeks) is 0.74%. We take these results with a grain of salt, since it does not rule out negative returns over the subsequent four-week period. However, we find it supports prospects for the market to bounce back once short-term supply imbalances recede. Over the longer term, we continue to find municipal bonds attractive. The favorable supply-demand backdrop underpinning the market for much of the past few years remains intact. The municipal bond market is likely to exhibit very limited net new growth in 2013 with total supply to be similar, or only slightly greater, than that of Additionally, we believe market reaction to a potential 28% cap on municipal interest income is premature. Tax treatment of municipal bonds could take several forms (e.g., older issues could be grandfathered leading to a potential rally), and we would not make trading decisions based solely upon anticipating changes to tax treatment. Furthermore, higher tax rates without a cap would likely bolster municipal bonds. Municipal bonds remain one of our favorite high-quality bond sectors to eke out the best of what is likely to be a low-return environment in 2013 (please see our Outlook 2013 and the December 4, 2012 Bond Market Perspectives:Fixed Income 2013 Outlook). The lackluster return environment that is likely in store for bond investors in 2013 is cause for a contrarian view, in our opinion. Such bouts of weakness should be used by investors to bargain hunt and lock in more attractive yields or total return opportunities in the municipal bond market. IMPORTANT DISCLOSURES The economic forecasts set forth in the presentation may not develop as predicted and there can be no guarantee that strategies promoted will Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values and yields will decline as interest rates rise, and bonds are subject to availability and change in price. Corporate bonds are considered higher risk than government bonds, but normally offer a higher yield and are subject to market, interest rate Municipal bonds are subject to availability, price, and to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rate rise. Interest income may be subject to the alternative minimum tax. Federally tax-free, but other state and local taxes may apply. Treasuries are marketable, fixed-interest U.S. government debt securities. Treasury bonds make interest payments semi-annually, and the income that holders receive is only taxed at the federal level. High-yield/junk bonds (grade BB or below) are not investment grade securities, and are subject to higher interest rate, credit, and liquidity risks than those graded BBB and above. They generally should be part of a diversified portfolio for sophisticated investors. An obligation rated 'AAA' has the highest rating assigned by Standard & Poor's. The obligor's capacity to meet its financial commitment on the obligation is extremely strong. Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate. Default rate is the rate in which debt holders default on the amount of money that they owe. It is often used by credit card companies when setting interest rates, but also refers to the rate at which corporations default on their loans. Default rates tend to rise during economic downturns, since investors and businesses see a

5 5 decline in income and sales while still required to pay off the same amount of debt. This information is not intended to be a substitute for specific individualized tax, legal or investment planning advice. We suggest that you discuss your specific tax issues with a qualified tax advisor. INDEX DESCRIPTIONS Barclays Aggregate Bond Index: is comprised of the Barclays Government/Corporate Bond Index, Mortgage- Backed Securities Index, and Asset-Backed Securities Index, including securities that are of investment-grade quality or better, have at least one year to maturity, and have an outstanding par value of at least $100 million. The Barclays Municipal Bond Index is a market capitalization-weighted index of investment-grade municipal bonds with maturities of at least one year. All indices are unmanaged and include reinvested dividends. One cannot invest directly in an index. Past performance is no guarantee of future results. This research material has been prepared by LPL Financial. To the extent you are receiving investment advice from a separately registered independent investment advisor, please note that LPL Financial is not an affiliate of and makes no representation with respect to such entity. Tracking # Exp. 12/13

6 The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) may be appropriate for you, consult your financial advisor prior to investing. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and cannot be invested into directly. LPL Financial, Member FINRA/SIPC This newsletter was created using Newsletter OnDemand, powered by S&P Capital IQ Financial Communications.

Bond Market Perspectives

Bond Market Perspectives LPL FINANCIAL RESEARCH Bond Market Perspectives March 26, 2013 High-Yield Bonds and the Credit Cycle Anthony Valeri, CFA Market Strategist LPL Financial Highlights More speculative issuance has increased

More information

Bond Market Perspectives

Bond Market Perspectives LPL FINANCIAL RESEARCH Bond Market Perspectives 20, 20 Municipals Bloom Amid Drought Anthony Valeri, CFA Market Strategist LPL Financial Highlights Limited new issuance and Treasury market strength have

More information

Bond Market Perspectives

Bond Market Perspectives LPL FINANCIAL RESEARCH Bond Market Perspectives October 1, 2013 Many Happy Returns Anthony Valeri, CFA Market Strategist LPL Financial Highlights September bond market performance saw gains across all

More information

Bond Market Perspectives

Bond Market Perspectives LPL FINANCIAL RESEARCH Bond Market Perspectives August 6, 2013 It s a Grind Anthony Valeri, CFA Market Strategist LPL Financial Highlights Bond market performance is still attempting to stabilize. This

More information

YOUR FINANCIAL FUTURE

YOUR FINANCIAL FUTURE YOUR FINANCIAL FUTURE August 2014 In This Issue Bond Market Perspectives Week of August 4, 2014 Last weeks batch of top-tier economic data failed to act as a catalyst for additional bond gains. Weekly

More information

Parsing Puerto Rico. July 24, 2015 by Anthony Valeri of LPL Financial

Parsing Puerto Rico. July 24, 2015 by Anthony Valeri of LPL Financial Parsing Puerto Rico July 24, 2015 by Anthony Valeri of LPL Financial KEY TAKEAWAYS Puerto Rico s debt crisis remains isolated and not symptomatic of the broad municipal bond market. Signs of contagion

More information

Bond Market Perspectives

Bond Market Perspectives LPL FINANCIAL RESEARCH Bond Market Perspectives December 16, 2014 Tempting TIPS Anthony Valeri, CFA Fixed Income & Investment Strategist LPL Financial Highlights Lower inflation expectations as a result

More information

BOND MARKET PERSPECTIVES CROSSED WIRES KEY TAKEAWAYS LPL RESEARCH. June 23 2015 HAMMER FLAT: MIDYEAR BOND MARKET OUTLOOK

BOND MARKET PERSPECTIVES CROSSED WIRES KEY TAKEAWAYS LPL RESEARCH. June 23 2015 HAMMER FLAT: MIDYEAR BOND MARKET OUTLOOK LPL RESEARCH BOND MARKET PERSPECTIVES KEY TAKEAWAYS We continue to expect roughly flat bond returns for 2015, as the choppy market environment witnessed over the first half of 2015 continues. The challenging,

More information

Evergreen INSTITUTIONAL MONEY MARKET FUNDS. Prospectus July 1, 2009

Evergreen INSTITUTIONAL MONEY MARKET FUNDS. Prospectus July 1, 2009 Evergreen INSTITUTIONAL MONEY MARKET FUNDS Prospectus July 1, 2009 Evergreen Institutional 100% Treasury Money Market Fund Evergreen Institutional Money Market Fund Evergreen Institutional Municipal Money

More information

Understanding Fixed Income

Understanding Fixed Income Understanding Fixed Income 2014 AMP Capital Investors Limited ABN 59 001 777 591 AFSL 232497 Understanding Fixed Income About fixed income at AMP Capital Our global presence helps us deliver outstanding

More information

Timely Topics. The Benchmark Standard. May 30, 2013. Highlights. What Is a Benchmark, and Why Is It Important? LPL FINANCIAL RESEARCH

Timely Topics. The Benchmark Standard. May 30, 2013. Highlights. What Is a Benchmark, and Why Is It Important? LPL FINANCIAL RESEARCH LPL FINANCIAL RESEARCH Timely Topics May 30, 2013 The Benchmark Standard Highlights LPL Financial Research believes investors need to choose a benchmark that best reflects the investment style of their

More information

RETIREMENT INSIGHTS. Is It Time to Rebalance Your Plan Investments? Mutual Fund Categories: A Primer for New Investors

RETIREMENT INSIGHTS. Is It Time to Rebalance Your Plan Investments? Mutual Fund Categories: A Primer for New Investors RETIREMENT INSIGHTS July 2014 Your HFS Team Heffernan Financial Services 188 Spear Street, Suite 550 San Francisco, CA 94105 800-437-0045 rebeccat@heffgroup.com www.heffgroupfs.com CA Insurance Lic# 0I18899

More information

The Case for a Custom Fixed Income Benchmark. ssga.com/definedcontribution REFINING THE AGG

The Case for a Custom Fixed Income Benchmark. ssga.com/definedcontribution REFINING THE AGG The Case for a Custom Fixed Income Benchmark ssga.com/definedcontribution REFINING THE AGG For decades, the Barclays US Aggregate Index (the Agg ) has been a popular benchmark for core bond investment

More information

Bond Market Perspectives

Bond Market Perspectives LPL FINANCIAL RESEARCH Bond Market Perspectives April 8, 2014 The Future According to the Bond Market Anthony Valeri, CFA Market Strategist LPL Financial Highlights At any given time, current bond market

More information

Bond Mutual Funds. a guide to. A bond mutual fund is an investment company. that pools money from shareholders and invests

Bond Mutual Funds. a guide to. A bond mutual fund is an investment company. that pools money from shareholders and invests a guide to Bond Mutual Funds A bond mutual fund is an investment company that pools money from shareholders and invests primarily in a diversified portfolio of bonds. Table of Contents What Is a Bond?...

More information

2015 Mid-Year Market Review

2015 Mid-Year Market Review 2015 Mid-Year Market Review Cedar Hill Associates, LLC www.cedhill.com 6111 North River Road, Suite 1100, Rosemont, Illinois 60018 Phone: 312/445-2900 An Affiliate of MB Financial Bank 2015 Major Investment

More information

Prospectus Baird Funds

Prospectus Baird Funds Prospectus Baird Funds May 1, 2014 Baird Ultra Short Bond Fund (Institutional Class: BUBIX) (Investor Class: BUBSX) Baird Short-Term Bond Fund (Institutional Class: BSBIX) (Investor Class: BSBSX) Baird

More information

Impact of rising interest rates on preferred securities

Impact of rising interest rates on preferred securities Impact of rising interest rates on preferred securities This report looks at the risks preferred investors may face in a rising-interest-rate environment. We are currently in a period of historically low

More information

T. Rowe Price Target Retirement 2030 Fund Advisor Class

T. Rowe Price Target Retirement 2030 Fund Advisor Class T. Rowe Price Target Retirement 2030 Fund Advisor Class Supplement to Summary Prospectus Dated October 1, 2015 Effective February 1, 2016, the T. Rowe Price Mid-Cap Index Fund and the T. Rowe Price Small-Cap

More information

Bonds, in the most generic sense, are issued with three essential components.

Bonds, in the most generic sense, are issued with three essential components. Page 1 of 5 Bond Basics Often considered to be one of the most conservative of all investments, bonds actually provide benefits to both conservative and more aggressive investors alike. The variety of

More information

High-Yield Municipal Bonds

High-Yield Municipal Bonds High-Yield Municipal Bonds 1 ETF Disclosure This material does not constitute an offer to sell or solicitation to buy any security, including shares of any Fund. An offer or solicitation will be made only

More information

Unit Investment Trusts

Unit Investment Trusts a guide to Unit Investment Trusts A unit investment trust (UIT) is a registered investment company that buys and holds a generally fixed portfolio of stocks, bonds, or other securities. Table of Contents

More information

Energizing High Yield Bond Investors: Finding Opportunities Amid Shifting Market Conditions

Energizing High Yield Bond Investors: Finding Opportunities Amid Shifting Market Conditions Energizing High Yield Bond Investors: Finding Opportunities Amid Shifting Market Conditions Energizing High Yield Bond Investors: Finding Opportunities Amid Shifting Market Conditions Contents Executive

More information

Why Consider Bank Loan Investing?

Why Consider Bank Loan Investing? Why Consider Bank Loan Investing? September 2012 Bank loans continue to increase in popularity among a variety of investors in search of higher yield potential than other types of bonds, with lower relative

More information

Retirement Balanced Fund

Retirement Balanced Fund SUMMARY PROSPECTUS TRRIX October 1, 2015 T. Rowe Price Retirement Balanced Fund A fund designed for retired investors seeking capital growth and income through investments in a combination of T. Rowe Price

More information

Prospectus Socially Responsible Funds

Prospectus Socially Responsible Funds Prospectus Socially Responsible Funds Calvert Social Investment Fund (CSIF) Balanced Portfolio Equity Portfolio Enhanced Equity Portfolio Bond Portfolio Money Market Portfolio Calvert Social Index Fund

More information

Madison Investment Advisors LLC

Madison Investment Advisors LLC Madison Investment Advisors LLC Intermediate Fixed Income SELECT ROSTER Firm Information: Location: Year Founded: Total Employees: Assets ($mil): Accounts: Key Personnel: Matt Hayner, CFA Vice President

More information

High Yield Fixed Income Credit Outlook

High Yield Fixed Income Credit Outlook High Yield Fixed Income Credit Outlook Brendan White, CFA Portfolio Manager, Touchstone High Yield Fund Fort Washington Investment Advisors, Inc. September 28, 2011 The opinions expressed are current as

More information

Pioneer AMT-Free Municipal Fund

Pioneer AMT-Free Municipal Fund Pioneer AMT-Free Municipal Fund COMMENTARY Performance Analysis & Commentary September 2015 Fund Ticker Symbols: PBMFX (Class A); PBYMX (Class Y) us.pioneerinvestments.com Third Quarter Review Pioneer

More information

April 2016. Investment case: municipal bonds

April 2016. Investment case: municipal bonds April 2016 Investment case: municipal bonds ETF disclosure This material does not constitute an offer to sell or solicitation to buy any security, including shares of any Fund. An offer or solicitation

More information

Important Information about Closed-End Funds and Unit Investment Trusts

Important Information about Closed-End Funds and Unit Investment Trusts Robert W. Baird & Co. Incorporated Important Information about Closed-End Funds and Unit Investment Trusts Baird has prepared this document to help you understand the characteristics and risks associated

More information

FLOATING RATE BANK LOANS: A BREAK FROM TRADITION FOR INCOME-SEEKING INVESTORS. Why does the bank loan sector remain so attractive?

FLOATING RATE BANK LOANS: A BREAK FROM TRADITION FOR INCOME-SEEKING INVESTORS. Why does the bank loan sector remain so attractive? FLOATING RATE BANK LOANS: A BREAK FROM TRADITION FOR INCOME-SEEKING INVESTORS Bank loans present a compelling income opportunity and a portfolio diversifier that provides protection against traditional

More information

Re-Assessing Multi-Strategy Hedge Funds Aaron Mirandon, Associate Portfolio Manager

Re-Assessing Multi-Strategy Hedge Funds Aaron Mirandon, Associate Portfolio Manager Re-Assessing Multi-Strategy Hedge Funds Aaron Mirandon, Associate Portfolio Manager { Overview } The market returns from September 2008 through mid-2010 have introduced some extraordinary market movements

More information

Balanced fund: A mutual fund with a mix of stocks and bonds. It offers safety of principal, regular income and modest growth.

Balanced fund: A mutual fund with a mix of stocks and bonds. It offers safety of principal, regular income and modest growth. Wealth for Life Glossary Aggressive growth fund: A mutual fund that aims for the highest capital gains. They often invest in smaller emerging companies that offer maximum growth potential. Adjustable Rate

More information

Is it time to hire a professional to manage your bonds?

Is it time to hire a professional to manage your bonds? Is it time to hire a professional to manage your bonds? Today s bond markets are more complex Finding the right bonds can be difficult. The bond markets are large and complex, and it takes a lot of homework

More information

PROFESSIONAL FIXED-INCOME MANAGEMENT

PROFESSIONAL FIXED-INCOME MANAGEMENT MARCH 2014 PROFESSIONAL FIXED-INCOME MANAGEMENT A Strategy for Changing Markets EXECUTIVE SUMMARY The bond market has evolved in the past 30 years and become increasingly complex and volatile. Many investors

More information

Bond Market Insights October 10, 2014

Bond Market Insights October 10, 2014 Bond Market Insights October 10, 2014 by John Simms, CFA and Jerry Wiesner, CFA General Bond Market Treasury yields rose in September as prices fell. Yields in the belly of the curve (5- to 7-year maturities)

More information

Risk Management and Retirement Planning

Risk Management and Retirement Planning YOUR FINANCIAL FUTURE April 2015 In This Issue Diversification: A Big Word, With Bigger Investment Implications When investing, don't put all of your eggs in one basket. Diversify to manage risk and potentially

More information

Global high yield: We believe it s still offering value December 2013

Global high yield: We believe it s still offering value December 2013 Global high yield: We believe it s still offering value December 2013 02 of 08 Global high yield: we believe it s still offering value Patrick Maldari, CFA Senior Portfolio Manager North American Fixed

More information

High Yield Credit: An Evaluation for Prospective Insurance Company Investors

High Yield Credit: An Evaluation for Prospective Insurance Company Investors High Yield Credit: An Evaluation for Prospective Insurance Company Investors Low interest rates challenging traditional insurance company business model More insurance companies using high yield to mitigate

More information

Global Financials Update April 13, 2012

Global Financials Update April 13, 2012 Global Financials Update April 13, 2012 Global Market Update After posting a fairly strong and consistent rally over much of the last six months, the global equity markets have changed course over the

More information

Investment insight. Fixed income the what, when, where, why and how TABLE 1: DIFFERENT TYPES OF FIXED INCOME SECURITIES. What is fixed income?

Investment insight. Fixed income the what, when, where, why and how TABLE 1: DIFFERENT TYPES OF FIXED INCOME SECURITIES. What is fixed income? Fixed income investments make up a large proportion of the investment universe and can form a significant part of a diversified portfolio but investors are often much less familiar with how fixed income

More information

An Overview of the US Closed-End Fund Market. By Paul Mazzilli

An Overview of the US Closed-End Fund Market. By Paul Mazzilli An Overview of the US Closed-End Fund Market By Paul Mazzilli Introduction Closed-end funds (CEFs) are professionally managed investment companies that offer investors various unique benefits. They offer

More information

Generate More Efficient Income and a Stronger Portfolio

Generate More Efficient Income and a Stronger Portfolio Generate More Efficient Income and a Stronger Portfolio All examples shown are hypothetical and for illustrative purposes only and do not represent the performance of an actual investment. Past performance

More information

In Search of Yield. Actively Managed High Yield Bond Funds May Offer Long-Term Value

In Search of Yield. Actively Managed High Yield Bond Funds May Offer Long-Term Value In Search of Yield Actively Managed High Yield Bond Funds May Offer Long-Term Value In Search of Yield The Case for Actively Managed High Yield Bond Funds CONTENTS 2 Losing Ground to Inflation: The Impact

More information

Web. Chapter FINANCIAL INSTITUTIONS AND MARKETS

Web. Chapter FINANCIAL INSTITUTIONS AND MARKETS FINANCIAL INSTITUTIONS AND MARKETS T Chapter Summary Chapter Web he Web Chapter provides an overview of the various financial institutions and markets that serve managers of firms and investors who invest

More information

Leader Short-Term Bond Fund. Leader Total Return Fund

Leader Short-Term Bond Fund. Leader Total Return Fund Leader Short-Term Bond Fund Institutional Shares: Investor Shares: Class A Shares: Class C Shares: LCCIX LCCMX LCAMX LCMCX Leader Total Return Fund Institutional Shares: Investor Shares: Class A Shares:

More information

Fixed Income Investments. Private Banking USA

Fixed Income Investments. Private Banking USA Fixed Income Investments Credit Suisse Securities (USA) llc Private Banking USA 2 Preservation of your wealth is our first priority. Introduction Fixed Income Investing Today In the last two decades, investors

More information

MainStay VP Janus Balanced Portfolio

MainStay VP Janus Balanced Portfolio Summary Prospectus May 1, 2015 MainStay VP Janus Balanced Portfolio To Statutory Prospectus To Statement of Additional Information Before you invest, you may want to review the Portfolio's Prospectus,

More information

Average Annualized Return as of 11/30/2015 1. YTD 1 Year 3 Years 5 Years

Average Annualized Return as of 11/30/2015 1. YTD 1 Year 3 Years 5 Years Investment Options at a glance Current performance may be lower or higher than performance data shown. Performance data quoted represents past performance and is not a guarantee or prediction of future

More information

LONG-TERM INVESTMENT PERFORMANCE

LONG-TERM INVESTMENT PERFORMANCE LONG-TERM INVESTMENT PERFORMANCE Source: Created by Raymond James using Ibbotson Presentation Materials 2011 Morningstar. All Rights Reserved. 3/1/2011 Used with permission. TYPES OF ASSET CLASSES Stocks

More information

The Argument for Corporate Debt December 2008

The Argument for Corporate Debt December 2008 The Argument for Corporate Debt December 2008 This past quarter the US economy has experienced what appears to be the crescendo of a credit crisis that has been building for well over a year. The causes

More information

Fixed Income: The Hidden Risk of Indexing

Fixed Income: The Hidden Risk of Indexing MANNING & NAPIER ADVISORS, INC. Fixed Income: The Hidden Risk of Indexing Unless otherwise noted, all figures are based in USD. Fixed income markets in the U.S. are vast. At roughly twice the size of domestic

More information

Energizing High Yield Bond Investors: Finding Opportunities Amid Shifting Market Conditions

Energizing High Yield Bond Investors: Finding Opportunities Amid Shifting Market Conditions SM Energizing High Yield Bond Investors: Finding Opportunities Amid Shifting Market Conditions Energizing High Yield Bond Investors: Finding Opportunities Amid Shifting Market Conditions Contents Executive

More information

Fixed Income Liquidity in a Rising Rate Environment

Fixed Income Liquidity in a Rising Rate Environment Fixed Income Liquidity in a Rising Rate Environment 2 Executive Summary Ò Fixed income market liquidity has declined, causing greater concern about prospective liquidity in a potential broad market sell-off

More information

to Wealth Management resources of one of the world s largest financial services firms. The Caribbean Group

to Wealth Management resources of one of the world s largest financial services firms. The Caribbean Group A Defined Approach to Wealth Management Giving UWI access to the combined resources of one of the world s largest financial services firms. The Caribbean Group The information in this presentation is intended

More information

FIXED INCOME STRATEGY HIGHLIGHTS OCTOBER, 2015

FIXED INCOME STRATEGY HIGHLIGHTS OCTOBER, 2015 FIXED INCOME STRATEGY HIGHLIGHTS OCTOBER, 2015 IN BRIEF: The U.S. Fixed Income Markets During the third quarter, the U.S. economy showed continued progress coupled with a decline in the U.S. unemployment

More information

Guide to mutual fund investing. Start with the basics

Guide to mutual fund investing. Start with the basics Guide to mutual fund investing Start with the basics Pursue your financial goals Why do you invest? For a rainy day? A secure retirement? Funding a college tuition? Having a specific goal in mind will

More information

Saving and Investing. Chapter 11 Section Main Menu

Saving and Investing. Chapter 11 Section Main Menu Saving and Investing How does investing contribute to the free enterprise system? How does the financial system bring together savers and borrowers? How do financial intermediaries link savers and borrowers?

More information

UBS RMA Money Market Portfolio U.S. Government Portfolio Tax-Free Fund California Municipal Money Fund New York Municipal Money Fund

UBS RMA Money Market Portfolio U.S. Government Portfolio Tax-Free Fund California Municipal Money Fund New York Municipal Money Fund Money Market Funds Prospectus UBS RMA Money Market Portfolio U.S. Government Portfolio Tax-Free Fund California Municipal Money Fund New York Municipal Money Fund Prospectus August 28, 2015 Ticker symbols:

More information

Leveraged Loan Funds: Debunking the Myths

Leveraged Loan Funds: Debunking the Myths Leveraged Loan Funds: Debunking the Myths SM Leveraged Loan Funds: Debunking the Myths Contents 2 Myth #1: Managing liquidity in actively managed leveraged loan mutual funds is difficult. 3 Myth #2: In

More information

J.P. Morgan bond funds

J.P. Morgan bond funds NOT FDIC INSURED NO BANK GUARANTEE MAY LOSE VALUE J.P. Morgan bond funds Instruments for increasing income and diversification potential Find the answers inside What is a bond? p. 2 Become an informed

More information

Taxable Fixed Income Outlook: Waiting for Those Rising Rates

Taxable Fixed Income Outlook: Waiting for Those Rising Rates Taxable Fixed Income Outlook: Waiting for Those Rising Rates Market Commentary Fourth quarter 2014 MOST INVESTORS UNDERSTAND THAT INTEREST RATES ARE UNPREDICTABLE. But we suspect few believed rates could

More information

UBS RMA Money Market Portfolio U.S. Government Portfolio Tax-Free Fund California Municipal Money Fund New York Municipal Money Fund

UBS RMA Money Market Portfolio U.S. Government Portfolio Tax-Free Fund California Municipal Money Fund New York Municipal Money Fund Money Market Funds Prospectus and SAI Supplement UBS RMA Money Market Portfolio U.S. Government Portfolio Tax-Free Fund California Municipal Money Fund New York Municipal Money Fund Supplement to the Prospectus

More information

Fixed Income Review. Second Quarter 2015

Fixed Income Review. Second Quarter 2015 Second Quarter 2015 As of June 30, 2015 Total Return Performance Calendar Year Performance Index MTD QTD YTD 2014 2013 2012 Barclays US Aggregate -1.1% -1.7% -0.1% 6.0% -2.0% 4.2% BAML US Agency Index

More information

The recent volatility of high-yield bonds: Spreads widen though fundamentals stay strong

The recent volatility of high-yield bonds: Spreads widen though fundamentals stay strong Investment Insights The recent volatility of high-yield bonds: Spreads widen though fundamentals stay strong Kevin Lorenz, CFA, Managing Director, Lead Portfolio Manager of TIAA-CREF's High-Yield Fund

More information

FLOATING RATE BANK LOANS: A BREAK FROM TRADITION FOR INCOME-SEEKING INVESTORS

FLOATING RATE BANK LOANS: A BREAK FROM TRADITION FOR INCOME-SEEKING INVESTORS FLOATING RATE BANK LOANS: A BREAK FROM TRADITION FOR INCOME-SEEKING INVESTORS With about $713 billion in assets, the bank loan market is roughly half the size of the high yield market. However, demand

More information

With interest rates at historically low levels, and the U.S. economy showing continued strength,

With interest rates at historically low levels, and the U.S. economy showing continued strength, Managing Interest Rate Risk in Your Bond Holdings THE RIGHT STRATEGY MAY HELP FIXED INCOME PORTFOLIOS DURING PERIODS OF RISING INTEREST RATES. With interest rates at historically low levels, and the U.S.

More information

Fixed Income Investing: What s an Investor to Do?

Fixed Income Investing: What s an Investor to Do? INSIGHTS Fixed Income Investing: What s an Investor to Do? July 2012 203.621.1700 2012, Rocaton Investment Advisors, LLC Executive Summary As interest rates have fallen steadily over the past 20 years,

More information

Master Limited Partnerships (MLPs)

Master Limited Partnerships (MLPs) 1Q 2016 Master Limited Partnerships (MLPs) Distinct Focus on Yield VanEck Vectors TM High Income Infrastructure MLP ETF (YMLI) VanEck Vectors TM High Income MLP ETF (YMLP) ETF disclosure This material

More information

Investing in a Rising Rate Environment

Investing in a Rising Rate Environment Investing in a Rising Rate Environment How Rising Interest Rates Affect Bond Portfolios By Baird s Private Wealth Management Research Summary With historically low interest rates and the unprecedented

More information

BOND FUNDS L SHARES. October 1, 2004

BOND FUNDS L SHARES. October 1, 2004 BOND FUNDS A SHARES L SHARES October 1, 2004 CLASSIC INSTITUTIONAL U.S. GOVERNMENT SECURITIES SUPER SHORT INCOME PLUS FUND FLORIDA TAX-EXEMPT BOND FUND GEORGIA TAX-EXEMPT BOND FUND HIGH INCOME FUND INVESTMENT

More information

STEWARD FUNDS MANAGING WEALTH, PROTECTING VALUES SOCIALLY RESPONSIBLE SCREENED FUNDS. PROSPECTUS August 28, 2015

STEWARD FUNDS MANAGING WEALTH, PROTECTING VALUES SOCIALLY RESPONSIBLE SCREENED FUNDS. PROSPECTUS August 28, 2015 STEWARD FUNDS MANAGING WEALTH, PROTECTING VALUES SOCIALLY RESPONSIBLE SCREENED FUNDS Steward Large Cap Enhanced Index Fund Individual Class SEEKX Institutional Class SEECX Steward Small-Mid Cap Enhanced

More information

Insurance Dedicated Funds: Variable Insurance Trusts

Insurance Dedicated Funds: Variable Insurance Trusts At a Glance September 2015 Insurance Dedicated Funds: Variable Insurance Trusts Our goal at GSAM is to meet the financial goals of investors worldwide, now and in the future, with innovative investment

More information

Bond Fund Investing in a Rising Rate Environment

Bond Fund Investing in a Rising Rate Environment MUTUAL FUND RESEARCH Danette Szakaly Ext. 71937 Date Issued: 1/14/11 Fund Investing in a Rising Rate Environment The recent rise in U.S. Treasury bond yields has some investors wondering how to manage

More information

Diminished Liquidity in the Corporate Bond Market: Implications for Fixed Income Investors

Diminished Liquidity in the Corporate Bond Market: Implications for Fixed Income Investors Diminished Liquidity in the Corporate Bond Market: Implications for Fixed Income Investors 3/16/215 Summary In the wake of the 27-8 Financial Crisis, investors increased their holdings of fixed income

More information

Fixed-income opportunity: Short duration high yield

Fixed-income opportunity: Short duration high yield March 2014 Insights from: An income solution for a low or rising interest-rate environment Generating income is a key objective for many investors, and one that is increasingly difficult to achieve in

More information

1. General Obligation Bonds (G.O.s): Bonds backed by the full taxing power of the issuer.

1. General Obligation Bonds (G.O.s): Bonds backed by the full taxing power of the issuer. S&P INDICES Fixed Income February 2010 S&P Fixed Income Indices: Municipal Bond Investor Tool Kit Key Terms Alternative Minimum Tax (AMT): An extra tax that some taxpayers are required to pay in addition

More information

High Yield Bonds in a Rising Rate Environment August 2014

High Yield Bonds in a Rising Rate Environment August 2014 This paper examines the impact rising rates are likely to have on high yield bond performance. We conclude that while a rising rate environment would detract from high yield returns, historically returns

More information

SPDR Nuveen S&P High Yield Municipal Bond ETF

SPDR Nuveen S&P High Yield Municipal Bond ETF SPDR Nuveen S&P High Yield Municipal Bond ETF Summary Prospectus-October 31, 2015 HYMB (NYSE Ticker) Before you invest in the SPDR Nuveen S&P High Yield Municipal Bond ETF (the Fund ), you may want to

More information

Start investing in yourself today, with help from the. Optional Retirement Plan (ORP) and Fidelity.

Start investing in yourself today, with help from the. Optional Retirement Plan (ORP) and Fidelity. State of Maryland - Institutions of Higher Education Optional Retirement Plan (ORP) Plan No. 65575 Start investing in yourself today, with help from the State of Maryland - Institutions of Higher Education

More information

Wells Fargo Advantage Dow Jones Target Date Funds SM

Wells Fargo Advantage Dow Jones Target Date Funds SM Wells Fargo Advantage Dow Jones Target Date Funds SM Annual Report February 28, 2015 Wells Fargo Advantage Dow Jones Target Today Fund SM Wells Fargo Advantage Dow Jones Target 2010 Fund SM Wells Fargo

More information

ALLOCATION STRATEGIES A, C, & I SHARES PROSPECTUS August 1, 2015

ALLOCATION STRATEGIES A, C, & I SHARES PROSPECTUS August 1, 2015 ALLOCATION STRATEGIES A, C, & I SHARES PROSPECTUS August 1, 2015 Investment Adviser: RidgeWorth Investments A Shares C Shares I Shares Aggressive Growth Allocation Strategy SLAAX CLVLX CVMGX Conservative

More information

DOES BLACK FRIDAY STILL MATTER?

DOES BLACK FRIDAY STILL MATTER? LPL RESEARCH PRIVATE CLIENT THOUGHT LEADERSHIP DISRUPTIVE INSIGHTS DOES BLACK FRIDAY STILL MATTER? November 215 SALES FOR THE HOLIDAY SEASON OVERALL HAVE ACTUALLY INCREASED OVER THE YEARS, DESPITE THE

More information

Closed-End Funds. A closed-end fund is a type of investment company. whose shares are listed on a stock exchange

Closed-End Funds. A closed-end fund is a type of investment company. whose shares are listed on a stock exchange a guide to Closed-End Funds A closed-end fund is a type of investment company whose shares are listed on a stock exchange or are traded in the over-the-counter market. Contents What Is a Closed-End Fund?...2

More information

Bond Snapshot with Kathy Jones The Year of the Taper

Bond Snapshot with Kathy Jones The Year of the Taper Bond Snapshot with Kathy Jones The Year of the Taper Kathy Jones, Vice President Fixed Income Strategist Schwab Center for Financial Research February 2014 Overview of Topics Tapering Implications Where

More information

HSBC Mutual Funds. Simplified Prospectus June 15, 2016

HSBC Mutual Funds. Simplified Prospectus June 15, 2016 HSBC Mutual Funds Simplified Prospectus June 15, 2016 Offering Investor Series, Advisor Series, Premium Series, Manager Series and Institutional Series units of the following Funds: Cash and Money Market

More information

MML Bay State Life Insurance Company Management s Discussion and Analysis Of the 2005 Financial Condition and Results of Operations

MML Bay State Life Insurance Company Management s Discussion and Analysis Of the 2005 Financial Condition and Results of Operations MML Bay State Life Insurance Company Management s Discussion and Analysis Of the 2005 Financial Condition and Results of Operations General Management s Discussion and Analysis of Financial Condition and

More information

Today s bond market is riskier and more volatile than in several generations. As

Today s bond market is riskier and more volatile than in several generations. As Fixed Income Approach 2014 Volume 1 Executive Summary Today s bond market is riskier and more volatile than in several generations. As interest rates rise so does the anxiety of fixed income investors

More information

Start investing in yourself today, with help from the University System of Maryland Supplemental 403(b) Plan and Fidelity.

Start investing in yourself today, with help from the University System of Maryland Supplemental 403(b) Plan and Fidelity. University System of Maryland Supplemental 403(b) Plan (#65612) Start investing in yourself today, with help from the University System of Maryland Supplemental 403(b) Plan and Fidelity. Invest some of

More information

California Municipal (CA Muni) Market Update

California Municipal (CA Muni) Market Update Investment Viewpoints Colleen Ambrose Vice President, Client Portfolio Manager California Municipal (CA Muni) Market Update Current credit and market conditions influencing the performance and strategies

More information

A VERY DIFFERENT NASDAQ

A VERY DIFFERENT NASDAQ LPL RESEARCH WEEKLY MARKET COMMENTARY KEY TAKEAWAYS The Nasdaq Composite just hit 5000 today as this report was going to press and is nearing its all-time record closing high of 5048. Even with the Nasdaq

More information

Exchange Traded Funds

Exchange Traded Funds LPL FINANCIAL RESEARCH Exchange Traded Funds February 16, 2012 What They Are, What Sets Them Apart, and What to Consider When Choosing Them Overview 1. What is an ETF? 2. What Sets Them Apart? 3. How Are

More information

Class / Ticker Symbol Fund Name Class A Class C Class C1 Class I

Class / Ticker Symbol Fund Name Class A Class C Class C1 Class I Mutual Funds Prospectus August 31, 2011 Nuveen Municipal Bond Funds Dependable, tax-free income because it s not what you earn, it s what you keep. Class / Ticker Symbol Fund Name Class A Class C Class

More information

ETF Investment Solutions How to Target the Bond Market s Sweet Spot with Crossover Bonds

ETF Investment Solutions How to Target the Bond Market s Sweet Spot with Crossover Bonds ETF Investment Solutions How to Target the Bond Market s Sweet Spot with Crossover Bonds CONTENTS I. ASSET CLASS BACKGROUND What Are Crossover Bonds? II. CHARACTERISTICS OF CROSSOVER BONDS What Are the

More information

Lane County Dental Society 1

Lane County Dental Society 1 Good Debt Bad Debt Presented by Jake Paltzer, CFP Debt Management Buy/Sell Agreements Investment Strategies Examples of Good Debt Student Loans Practice Financing Loans Personal Home Mortgage Tax benefits

More information

State Street Target Retirement Funds - Class K

State Street Target Retirement Funds - Class K The State Street Target Retirement Funds - Class K (the "Funds") represent units of ownership in the State Street Target Retirement Non-Lending Series Funds. The Funds seek to offer complete, low cost

More information

Bond Fund of the TIAA-CREF Life Funds

Bond Fund of the TIAA-CREF Life Funds Summary Prospectus MAY 1, 2015 Bond Fund of the TIAA-CREF Life Funds Ticker: TLBDX Before you invest, you may want to review the Fund s prospectus, which contains more information about the Fund and its

More information

Balanced Fund RPBAX. T. Rowe Price SUMMARY PROSPECTUS

Balanced Fund RPBAX. T. Rowe Price SUMMARY PROSPECTUS SUMMARY PROSPECTUS RPBAX May 1, 2016 T. Rowe Price Balanced Fund A fund seeking capital growth and current income through a portfolio of approximately 65% stocks and 35% fixed income securities. Before

More information

Fixed Income 2015 Update. Kathy Jones, Senior Vice President Chief Fixed Income Strategist, Schwab Center for Financial Research

Fixed Income 2015 Update. Kathy Jones, Senior Vice President Chief Fixed Income Strategist, Schwab Center for Financial Research Fixed Income 2015 Update Kathy Jones, Senior Vice President Chief Fixed Income Strategist, Schwab Center for Financial Research 1 Fed: Slow and Low 2015 Fixed Income Outlook 2 Yield Curve Flattening 3

More information