Doug Drabik discusses fixed income market conditions and offers insight for bond investors.
Every month, the Fixed Income Strategy team gets together (while practicing social distancing) to talk about the latest trends and ideas across the fixed income landscape. One topic was investor application in terms of significant concepts and ideas. A summary is highlighted in the following bullet points.
First, let me set the stage. This discussion stems as a result of our economic situation and position in the economic cycle. Not what’s happened because of the coronavirus, but rather what’s happened over decades of time.
There is no right or wrong or clear vision of what will occur in the future, just opinions on the evaluation of information. The more information provided, the easier to formulate an opinion on any particular issue. This is not an endorsement on any specific issue but rather an endorsement to keep from falling prey to grouping or herd-mentality. These are ways to increase yield within the high quality space but only if you understand and are willing to accept the associated risks.
To learn more about the risks and rewards of investing in fixed income, please access the Securities Industry and Financial Markets Association’s “Learn More” section of investinginbonds.com, FINRA’s “Smart Bond Investing” section of finra.org, and the Municipal Securities Rulemaking Board’s (MSRB) Electronic Municipal Market Access System (EMMA) “Education Center” section of emma.msrb.org.
The author of this material is a Trader in the Fixed Income Department of Raymond James & Associates (RJA), and is not an Analyst. Any opinions expressed may differ from opinions expressed by other departments of RJA, including our Equity Research Department, and are subject to change without notice. The data and information contained herein was obtained from sources considered to be reliable, but RJA does not guarantee its accuracy and/or completeness. Neither the information nor any opinions expressed constitute a solicitation for the purchase or sale of any security referred to herein. This material may include analysis of sectors, securities and/or derivatives that RJA may have positions, long or short, held proprietarily. RJA or its affiliates may execute transactions which may not be consistent with the report’s conclusions. RJA may also have performed investment banking services for the issuers of such securities. Investors should discuss the risks inherent in bonds with their Raymond James Financial Advisor. Risks include, but are not limited to, changes in interest rates, liquidity, credit quality, volatility, and duration. Past performance is no assurance of future results.
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