Luck_Club
Full time employment: Posting here.
- Joined
- Dec 5, 2016
- Messages
- 733
Back to Bonds
Good primer on buying, monitoring and managing bonds. Do I dare say it sounds like a lot of work.
https://www.fidelity.com/learning-c...d-investment-strategies?ccsource=email_weekly
Sector analysis of investment impacts of the tax reform more talk about impact to bonds.
https://www.fidelity.com/viewpoints/investing-ideas/investing-and-tax-reform
"US corporate bond quality—and rates—may rise
To the extent that tax reform benefits the bottom line of US companies that issue debt, their credit quality may improve. The repatriation of cash from foreign earnings may shift the capital structure of multinational corporations, allowing them to issue less debt to raise US operating cash. The limit on deductibility of debt interest payments will generally hit only the most highly levered companies (those issuing high yield debt), but may increase credit risk at the very lowest end of the credit spectrum.
To the extent that the act stimulates the economy as anticipated, the Fed may be encouraged to raise rates faster, which will influence government, corporate, and municipal rates. However, the Fed’s economic projections have accounted for moderately higher economic growth due to tax cuts, with no change as of yet to their policy rate projections. Actively managed bond funds may be best positioned to take advantage of shifts in the fixed income market as issuance volumes, issuer credit quality, and rates change."
Good primer on buying, monitoring and managing bonds. Do I dare say it sounds like a lot of work.
https://www.fidelity.com/learning-c...d-investment-strategies?ccsource=email_weekly
Sector analysis of investment impacts of the tax reform more talk about impact to bonds.
https://www.fidelity.com/viewpoints/investing-ideas/investing-and-tax-reform
"US corporate bond quality—and rates—may rise
To the extent that tax reform benefits the bottom line of US companies that issue debt, their credit quality may improve. The repatriation of cash from foreign earnings may shift the capital structure of multinational corporations, allowing them to issue less debt to raise US operating cash. The limit on deductibility of debt interest payments will generally hit only the most highly levered companies (those issuing high yield debt), but may increase credit risk at the very lowest end of the credit spectrum.
To the extent that the act stimulates the economy as anticipated, the Fed may be encouraged to raise rates faster, which will influence government, corporate, and municipal rates. However, the Fed’s economic projections have accounted for moderately higher economic growth due to tax cuts, with no change as of yet to their policy rate projections. Actively managed bond funds may be best positioned to take advantage of shifts in the fixed income market as issuance volumes, issuer credit quality, and rates change."