FMD Capital Management

Posts Tagged: treasury yields

Is A Dividend Cut On The Horizon For DBL?

Written by David Fabian, November 06th, 2017

One of the closed-end funds that seems to be a recurrent favorite on our watch list is the DoubleLine Opportunistic Credit Fund (DBL), run by Jeffrey Gundlach of DoubleLine Capital.  This unique actively managed portfolio was the first of its kind to debut from DoubleLine back in 2012 and has developed a cult following among CEF investors.

DBL primarily invests in a mixed basket of mortgage backed securities, collateralized loan obligations and other asset backed securities.  The fund has just over $325 million in total assets with a relatively tame 16% leverage ratio to boost its net exposure.  It currently yields over 8% annually and income is paid monthly to shareholders.  Read more

A Closer Look At Top Interest Rate Hedged ETFs

Written by David Fabian, November 22nd, 2016

Most investors purchase bond funds with a degree of interest rate sensitivity.  This is by design as they want to experience the off-setting effects of falling interest rates in exchange for capital appreciation of the underlying bond portfolio.  It’s a built-in risk mechanism that has been a successful diversification component when paired with stocks and other assets higher up the volatility scale.

Yet, after decades of falling rates, the long-term return expectations of many bond funds have fallen dramatically.  There is also growing concern that even a modest rise in Treasury yields will create a significant shift in the risk appetites of bond investors.  With so much anxiety surrounding the recent jump in interest rates, now may be a prudent time to explore the menu of bond ETFs with an embedded hedging component.

Read the complete article at NASDAQ.com

State Of The Market In 7 Charts – November 2016 Edition

Written by David Fabian, November 13th, 2016

It feels like we have almost packed a full year’s worth of stock market price action into just the last two weeks.  With so many diverging market sectors and overall fluctuations, I thought it would be prudent to do an examination of some key charts.

Taking a closer look at these categories can help frame macro views as well as determine areas of strength and weakness. Read more

The Great Bond Shift Rolls On

Written by David Fabian, September 01st, 2016

If there is one major theme that pervades the financial markets this year, it’s the shift from stocks to bonds.  You can romanticize about the momentum in gold stocks.  You can peek over at emerging market strength, but nothing compares to the pervasive re-allocation of global assets.  Read more

Leveraging Our Play on TIPS

Written by Michael Fabian, March 18th, 2016

For those that follow Treasury bond fluctuations closely, it’s been hard not to notice the persistent under performance in Treasury Inflation Protected Securities (TIPS) versus nominal coupon bonds over the last several years.  It’s no surprise that inflation has been running below expectations for a long time, despite a steadily falling unemployment rate and a generally improving economy.   Nevertheless, from a technical and fundamental perspective, the wide divergence that has formed between TIPS and fixed-coupon bonds can’t persist forever. Read more