Reward with moderate risk

Why are investors buying CCC garbage bonds, when one can purchase $25-par senior debt issued by institutions with solid balance sheets? Think: BANCL HCJ JMPB TVE TVC

Back in Black

I have been away for awhile building my newsletter/consulting business and launching my fixed income portfolio management business. Since I have been away, long-term interest rates, such as the 10-year UST yield, plummeted, spiked (to over 3.00% in the case of the 10-year)and plunged again. The loan market became the darling of investors and began to falter earlier this year. Fed policies have cause investors to reach for yield and become desensitized to risk. Fund marketers have jumped from strategy to strategy in an attempt to keep investors engaged. Meanwhile, if you built a diverse (laddered) portfolio of bonds and bought quality bonds on weakness (often as ill-advised and panicked investors threw babies out with the bathwater), you have performed as well as the exotic strategies in the near term without the credit and/or duration risk associated with more aggressive fixed income strategies. We will post here from time to time, but to get the real story in a timely manner (and to engage in professional portfolio management), visit our site at www.bond-squad.com. Until later, This is Bicycle Repairman signing off.