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LearnBonds.com

John Bogle: Total Corporate Bond Fund Needed…TIPS In Longest Selloff Since 2008…Bond Fund Duration: An Art Not A Science… and more!

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Indexuniverse: – Bogle: ‘Total’ Corporate Bond Fund Needed. – Bogle has been counseling investors in the past few years to find yield in corporate credits. He built on the that view when he told IndexUniverse.com Managing Editor Olly Ludwig that investors could really use a broad “total corporate bond” index fund to help them find yield at a time when the government bond market increasingly seems to be a losing proposition.

Bloomberg: – TIPS in longest selloff since ’08 as US bancorp cuts. – Firms from US Bancorp to Federated Investments that had been buying government securities that protect against rising consumer prices during the Fed’s recent efforts to inject cash into the economy are now selling. For the first time since the depths of the financial crisis in 2008, mutual funds that target Treasury Inflation-Protected Securities have seen outflows for three straight months.

Morningstar: – Bond fund duration: An art, not a science. –  duration or interest-rate duration can be a useful indicator for estimating the interest-rate risk of bonds that closely track the Treasury market. Any time you deviate from owning Treasuries, you get paid more yield and perhaps get a better longer-term total return (perhaps). But you assume more and different risks, and tracking them all becomes more complicated. It therefore makes sense to use duration with some caution–and to make the effort to know what’s in a fund’s portfolio, rather than relying on duration or any other single number or grade when evaluating its suitability for your portfolio.

Learn Bonds: – Is now the time for high income funds? – Investors who are profit taking may be wondering what to do with the profit. One possibility is to conservatively allocate to high income funds. I have a few favorites, though I like to allocate small amounts to several different funds, and keep the levels in each fund equal to the amount a given portfolio can generate within 6 to 12 months.

MarketWatch: – Bonds: What are your 401(k) options? – Your workplace retirement plan account — 401(k), 403(b) or 457 plans are the most common flavors — is designed for long-term investing, so it’s typically inappropriate to become overly concerned about short-term capital market trends when managing it. Nevertheless, you can still apply some lessons gleaned from following the markets to the management of your account.

BusinessWeek: – Treasury yields at almost 4-month low on slowing growth. – Treasury yields traded at almost the lowest level in four months as economic reports showed growth slowing in the world’s two largest economies, boosting the allure of US government debt.

FT: – Search for quality bonds hits pensions. – Despite record levels of contributions into pension schemes last year and stock markets hitting highs not seen in years, deficits will be larger, not smaller, than they were a year earlier. That’s because international accounting rules require liabilities to be discounted by the rate on high-quality corporate bonds. And as investors have snapped these up in the desperate search for higher returns, yields on these securities have fallen. The lower the yield on the bond, the bigger the liability.

Ben Kramer Miller: – A tactical approach to incorporating bonds into your inflation-protected portfolio. –In general bonds do not offer good value in the current inflationary environment. However investors should consider holding a small percentage of their assets in select bonds or bond funds.

ETF Daily: – Investing in long-term Treasury bond ETFs. –  Investors seeking to take advantage of the higher bond prices might try their luck with a long-term Treasury ETF. While there are a couple of choices in the space, we have highlighted the three most popular funds, which could be good avenues to park money with higher yields at this time.

Bloomberg: – Birmingham sells water bonds trailing market return. – The Water Works Board of Birmingham, the seat of bankrupt Jefferson County, Alabama, is selling $154 million of bonds as such revenue debt delivers the year’s worst returns.

Bloomberg: – Texas joins Lockyer targeting bonds fueling schools. –  Texas lawmakers are joining the push to curb municipal bonds that push off debt payments for as long as 40 years on loans for public schools built to handle surging enrolment.

MarketWatch: Foreigners showing less demand for US government bonds. – Foreigners aren’t buying as many US Treasury securities as they used to, according to data released Monday by the Treasury Department.

Tabb Forum: –  The transformation of the corporate bond market. – Principal-based dealer liquidity in the fixed income market simply cannot support the needs of a diverse marketplace. The buy-side trader needs the tools to take more control over the execution process, including more efficient mechanisms of price discovery to replace the traditional process of dealer phone-based quoting.

Zacks: – Top 5 highest yielding Zacks #1 ranked high yield bond mutual funds. –  Investors willing to undertake a higher level of risk in pursuit of high income levels would do well to consider high yield bonds. This category generally represents corporate bonds with low ratings, often below investment grade. A significant amount of risk is therefore associated with these investments and mutual funds are the best option to invest in these instruments. By investing in a well diversified portfolio of such securities they successfully lower the associated risk for the investor.

Minyanville: – Equities and the corporate bond market: How the alphabet soup monsters play into today’s market.  – As long as junk bond sales continue at record pace, as long as the awakening of the “alphabet soup” monsters is only limited by a lack of underlying loans, and as long as buyers heed the siren song of 20%, 35%, and 90% returns by buying “sausages” of loans, companies will have an unending stream of money available to manipulate their equities.

https://twitter.com/PIMCO/status/323801883833679872

https://twitter.com/BobBrinker/status/323838589429506048

https://twitter.com/BobBrinker/status/323838237183459328

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