Something’s up at Morningstar….Bottom Fishing in Knight Bonds….and more!


Best of the bond market for August 2nd, 2012

Wall Street Rant: There’s something fishy going on with Morningstar’s analyst ratings –  only 7% of fund’s are rated negatively.

BusinessWeek: Those looking at Knight Capital Group stock might want to check out the bonds instead – The company’s $375 million of 3.5 percent convertible bonds due in March 2015 fell 10.125 cents to 73 cents on the dollar and yielded 16.7 percent as of 10:57 a.m.  The bonds are convertible to stock at $20.87 a share.

Index Universe: 1 Year on the US S&P downgrade  proved to “be one of the greatest contrarian indicators of all time”. – Treasurys of all maturities began rising the following Monday. They didn’t stop climbing, and really haven’t stopped yet.

FT:What the US faces today is as much a political problem as it is an economic one” – Quote from PIMCO’s Mohamed El Erian’s latest piece.

Learn Bonds: Doug Kass’ “trade of the decade” looks more like the miss of the decade to us. Doug Kass has been wrong on treasuries for quite some time now.

ETF Trends: PIMCO’s Total Return ETF is up 8.3% since its march inception, compared to 4.7% for the Total Return Fund.  The mutual fund took in $2 Billion last month vs. $563 Million for the BOND ETF.

Business Insider: The 6 main alternatives to treasuries – Muni’s, Sovereigns, Corporates, REITs, Dividend Stocks, Floating Rate Funds.

Zacks: Where to go for higher yields without straying too far off the reservation – They recommend 3 ETFs ISHG, AUNZ, BSJF.

The Financial Lexicon:  5 things to consider before selling your bonds.  – just because asset allocation enthusiasts may tell you to lower the fixed income side of your portfolio doesn’t mean you necessarily should.

Skyler Greene: Thinks the Treasury’s new variable rate notes will be good for investors – Since the bond’s coupon payment is floating, the bond should theoretically retain most or all of its value as interest rates rise. This provides investors with short-term safety (preservation of capital) without locking them into the absurdly low rates offered by today’s bonds.



  1. had reported, alsmot two weeks ago, that PIMCO, the largest bond fund in the world, had reportedly cut its holdings of US Treasuries to ZERO. This was big news at the time, and remains so now, in leu of the most recent events in Japan and


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