Written by David Fabian, July 12th, 2017
The world of bond funds is generally split along two distinct lines: active and passive. You either own the benchmark or you place your bets with the fund manager who is proactively trying to beat it. Both strategies offer numerous benefits and risks depending on your investment objectives.
With a passive index, you know exactly what you own and that you are going to get every tick of associated price movement from the portfolio. There are strict rules on what securities can be admitted and when they are rebalanced. These funds also offer the lowest costs in terms of direct investment expenses.
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Written by David Fabian, June 07th, 2016
As exchange-traded funds have evolved over the years, we have seen greater interest in funds that screen for a specific factor. This may include historical volatility, size, momentum, or even “quality” characteristics. This last term in particular is one that is often used with great reverence, but may mean vastly different things to different investors.
Quality can stand for superior products or services, low debt ratios, profitability trends, sustainable dividends, or stable earnings growth. In practice, several of these screens may applied to a large universe of stocks in order to find companies showing superior balance sheet characteristics versus their peers.
Written by David Fabian, September 05th, 2015
We have seen a big shift in investor appetite away from traditional value companies and into high flying growth names over the last several years. That trend has continued in 2015, yet the recent volatility may have investors reconsidering the fundamental qualities of the stocks in their portfolio. Read more
Written by Michael Fabian, September 04th, 2015
The newer generation of PIMCO closed-end funds (CEFs) have certainly had their share of winning streaks and setbacks. However, these unique strategies have generally added value and used their relatively high portfolio leverage productively.
We have advocated for these products virtually since their inception and subsequent IPO weakness due to their ability to significantly out-earn their stated distribution policies. This is largely the result of the shared manager of both funds; PIMCO CIO Dan Ivascyn, and his experience in the high income space stemming from the PIMCO Income Fund’s (PIMIX) very successful track record. Read more