Who got hurt the most by the rise in yields?

high yield curve

Over the last month, the yield on 10 year US Treasury has risen from 2.02% to 2.53%, or roughly 25%. The rise in rates has not been triggered by any particular incident,but a general sense that the US Federal Reserve will need to start cutting back … [Read more...]

Fed Funds Rates vs. Bond Mutual Funds


The sky is falling! Well at least it appears to be in the bond markets. I guess we cannot refer to this as a “Great Rotation” being that stocks have been getting hit pretty hard with the Fed’s recent decision to announce that an end of their stimulus … [Read more...]

HYD: Here’s How To Calculate Your True Taxable-Equivalent Yield


In Monday’s article, “HYD: A Rare Opportunity In This Municipal Bond ETF,” I noted the significant discount to its net asset value at which HYD was trading, and I outlined several key features of the fund. On Monday morning, the discount to NAV … [Read more...]

Misinterpreting the Fed is Creating a Buying Opportunity in Bonds


In Thursday’s article, “Hey Bernanke, What Are You So Afraid Of?” I noted that the current consensus for a rate hike in 2015 presupposes a pickup in economic activity, a falling unemployment rate, and slightly higher inflation than we have today. To … [Read more...]