Yields on 10-year Spanish government bonds have risen by 100 basis points since the beginning of March. With attention now switching back to Spain, it seems the brief hope provided by the European Central Bank’s massive liquidity injections has proved to be a false dawn. Why has confidence evaporated so quickly?
Taxable US investors usually invest the fixed-income part of their portfolios in municipal bonds. But a tax-aware strategy with the flexibility to look for the highest after-tax return across sectors is likely to be more rewarding over time, as my colleague Terry Hults explains below. (more…)
China’s recent move to widen the renminbi’s trading band is unlikely to impact the near-term path of the currency, but we believe it represents another important step forward in the country’s financial liberalization. Below, my colleague Anthony Chan explains how a more flexible—and stronger—currency is a vital component of policymakers’ efforts to rebalance China’s export-dependent economy. (more…)
Bond investing, like equity investing, is an increasingly global proposition today. Opportunities are present all over the world. Yet unlike equity investors, who have generally embraced global investing, bond investors in many countries continue to put all their eggs in one basket by focusing primarily on their home debt markets. We think this is a mistake.
It seems like every twist and turn in the US employment data is being observed under a microscope. But don’t let the weak job numbers in March fool you—the underlying trends still point to continued improvements on the employment front. (more…)
Why do so many investors restrict their emerging-market bond investments to sovereigns? The corporate bond universe has grown dramatically in recent years—and offers a terrific combination of higher credit quality, wider spreads and potential capital gains. (more…)
The most common goals for fixed-income investors are stability, generating income and diversifying their equity exposures. Our research suggests that they can achieve all three goals more efficiently if they don’t remain wedded to their traditional approaches and benchmarks.
Much has been said about the poor performance of hedge funds in 2011. Here’s why we don’t believe this undermines the case for hedge funds. (more…)