Emerging market bonds were one of the few bright spots across the fixed-income landscape in 2016. This category trailed only U.S. high yield debt by total return metrics despite some meaningful volatility in the aftermath of the U.S. election. Investors also took notice of this outperformance and the favorable yields to boot. Read more
The structural bull market is still intact for large-cap U.S. stocks as several benchmarks hit new all-time highs. In this video, I look at areas of the market that are showing a high degree of momentum and also sluggish price action. Observations of risk and reward are noted throughout. Charts include: large cap stocks, international stocks, defensive indexes, emerging market bonds, interest rates, and more. Recorded on August 11, 2016.
The definition of value is a fierce debate among investors that seek to find intrinsically underpriced assets. Some stand their ground on historical fundamentals like price/earnings or price/book ratios. Others look strictly at price relative to other potential opportunities as a measure of opportunity.
The picture becomes even more complicated when you try to compare or overlay differing asset classes. Income investors often blur the lines between bonds, dividend paying stocks, and alternative income assets. Read more
Negative interest rates in several major developed foreign nations may be the biggest theme driving the search for yield in 2016. Many investors have navigated their way to U.S. Treasury, investment grade corporate, and municipal bonds for safety. However, if you want an above average yield and are willing to take on more credit risk, emerging market bonds have become a preferred landing spot.
The weakness in the bond market this year has been primarily centered on Treasury and investment grade corporate debt, which has the highest sensitivity to interest rates. This of course has filtered down to indexes that are heavily overweight quality U.S. bonds. Read more