Mechanically, high-yield bonds have the same features as other types of bonds. They have a scheduled maintenance payment, a principal repayment at a specified maturity date, and in some but not all cases, maintain priority over other obligations in the capital structure. While the maintenance payment (or coupon) is typically fixed, the value of the bond is determined by the market's assessment of the probability of repayment.
The Fed's plan to tighten monetary policy and tighter regulation discouraging broker-dealers from taking risk, has led to less liquidity in the U.S. stock market and exacerbated daily moves.
Buying outright puts to hedge equity downside can be costly and a constant drain on portfolio returns.
In this piece, we will briefly explain how various defensive options strategies and passive option indices work and why Passaic Partners' tactical dynamic approach produces better risk-adjusted returns with transparency and liquidity.
From 1981 to today, something as simple as a stamp has gone from a cost of $0.18 to $0.47. How do CIOs with long term investment horizons protect their constituents from such heavy evaporation of purchasing power over the long run? For some time now, it seems the concept of inflation and the impact it can have on investor portfolios has been relegated to the world of academia. Any investor who really experienced the last time inflation was over 10% was born in 1960 and had just begun their careers. In the recent past, practitioners who have rung the bell to warn of rising inflation and responded with investments in commodities, TIPs and MLPs have had a volatile ride and been viewed by some as the “person who cried wolf”.