Bond ETFs For Rising Rates…Investors Choose Short Term Junk…Not All PIMCO Funds Are Bad…and more!

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Benzinga: – Bond ETFs to cope with rising interest rates. – Rising rates need not chase investors from all bond ETFs. Some have been holding up nicely while others may have been beaten up more than warranted given the ability of those funds to remain sturdy if rates continue to rise. Some examples follow.

MoneyBeat: – ETF investors step up their short game in junk bonds. – After last month’s bond market selloff, many investors are hunting for strategies that can still provide high yields but won’t get hurt by rising interest rates.

Morningstar:  – PIMCO’s income funds at bargain-basement prices. – Investors take note of fund offerings from bond giant PIMCO. However, savvy closed-end fund, or CEF, investors have been (rightly) wary of jumping into PIMCO’s typical CEF offerings because of staggeringly high premiums, despite generally good returns and high distribution payments. Interestingly, two of PIMCO’s multi strategy income funds have not garnered the lavish attention paid to other PIMCO funds and they usually sell at just modest premiums.

Learn Bonds: – Here’s a chart the bond bears will want to see. – In recent weeks, along with the sharp rise in Treasury rates, came a chorus of bond bears proclaiming yet again the end of the multi-decade bull market and the ushering in of a new bear market in bonds. It is the same story we’ve heard every year since 2009. Maybe the fifth time will be the charm. But for those who think we are on the cusp of a new multi-decade bear market in bonds, I would like to share the following chart.

John Dowdee: – How to construct a diversified bond portfolio for retirees. – Although bond funds have offered meager returns over the past few years, they are still an important asset class, especially for retirees who want to minimize risk. Most investors realize the advantages of diversifying their equity portfolio, but many retirees don’t give the same importance to diversifying bonds. This article discusses the different classes of bond funds and how they can be combined to generate a better return while still limiting risk.

Morningstar: – Is it time to peel back on bonds? – Some Morningstar.com readers are rethinking their fixed-income exposure, while others are sticking with their plans. So who is right?

ETF Trends: – Conflicting opinions on corporate bonds. – Considering the size of the market it’s not surprising that some market participants, even at the same firm, can have differing opinions of the investment-grade corporate bond market.

Richard Shaw: – Be watchful: Muni tax exemption under continued attack. – The Obama administration continues to push for limitation of the tax exemption of muni bonds at 28%. And according to the chief executive of Bond Dealers of America, the text of tax reform (proposed 28% cap) has a lot of legs and will be seriously considered.

Forbes: – Ending tax breaks on municipal bonds shifts burden to the rest of us. – Better check that portfolio: the Obama administration is continuing to push for limits on the tax exemption of municipal bonds. The plan was tucked away in the President’s budget introduced in April but hasn’t attracted much public attention – until now.

Citywire: – Fixed-rate bond savers unknowingly shifted into poorer deals. – Fixed-rate bond and ISA savers are being automatically placed into new products with poorer terms when their original contract matures.

ETF Trends: – PIMCO total return ETF upped Treasury bets in June amid outflows. – PIMCO Total Return ETF boosted its stake in U.S. government-related debt to 35% at the end of June from 31% at the end of May. The category includes Treasuries, inflation-indexed bonds and other securities.

MarketWatch: – Pimco bumped up bond holdings as yields jumped. – Bill Gross, manager of the world’s biggest bond fund at Pacific Investment Management Co. boosted exposure to interest-rate risk in June at a time when yields jumped, a move that led to the fund’s record quarterly loss in the second quarter.

ETF Daily News: – How to play the bond market rout. – It is almost certainly right to warn investors off 10-year Treasurys. The reason has nothing to do with economic forecasting or market timing. Rather it has everything to do with the Fed putting the world on notice that – while its future moves will be “data-dependent” – it expects to stop holding rates artificially low.

The Big Picture: – Short looks beautiful to bond investors. – Nice chart from WSJ looking at various ways to express Bond trades.

4 Traders: – Pimco’s Gross boosted mortgage-bond holdings. – Bill Gross, manager of the world’s biggest bond fund at Pacific Investment Management Co., boosted exposure to interest rate risks in June at time when yields jumped, a move that led to the fund’s record quarterly loss in the second quarter.

ETF Trends: – TIPS ETFs climb as inflation rises more than expected. – Inflation-indexed bond ETFs that fell harder than nominal Treasuries during the recent interest-rate spike were getting a lift Tuesday from a report showing consumer prices rose more than expected in June.

ETF Trends: – Four reasons to like munis. – Why are investors seeking more and more munis? I’d say there are four main factors, which I will cover here.

MuniNetGuide: – A grand debut for the year’s largest muni deal. – With temperatures rising across the nation, the municipal market too is heating up. This week’s muni new issue calendar is expected to top $9.65 billion of new volume, a sharp increase from the revised $5.38 billion that was priced last week, according to Thomson Reuters. Accounting for much of that supply is a $2.9 billion deal from the Grand Parkway Transportation Corp., scheduled for pricing on Wednesday.


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