Markets & Economy » Inflation is Not Dead: What to Expect in 2016

January 11, 2016 | Fixed Income

Years of disinflation coupled with very low market expectations for future inflation have lulled many investors into a false sense of security that inflation can’t happen in the U.S. Indeed, deflationary forces have recently been keeping a lid on inflation, including: A strong USD, which …

Markets & Economy » The Fed Concludes its Countdown to Liftoff

December 17, 2015 | Fixed Income

Following its two-day December meeting, the U.S. Federal Reserve’s policy setting Federal Open Market Committee (FOMC) decided to adjust the federal funds policy interest rate for the first time since December 2008. The rate will increase from a range of 0% to 0.25% to a range of 0.25% to 0.5%. …

Library » Using Derivatives in the Fixed Income Markets

October 16, 2015 | Fixed Income

Introduction While derivatives may have a negative connotation to some investors, it is common for fixed income managers to simply utilize them as risk management tools to adjust exposure to interest rate, credit, and currency risk rather than a means to take on excessive risk/leverage. As such, …

Marc Bushallow

Managing Director, Fixed Income

Markets & Economy » No Change in Rates: Comments on the Fed Decision

September 17, 2015 | Market Commentary

Following their two day meeting in mid-September, members of the U.S. Federal Reserve’s policy setting Federal Open Market Committee (FOMC) decided not to adjust the federal funds policy interest rate. The rate will remain within the current 0% to 0.25% range, where it has been since December 20 …

Marc Bushallow

Managing Director, Fixed Income

Markets & Economy » The Great Rate Hike

September 11, 2015 | Fixed Income

Recent headlines suggest that bond investors are bracing for heightened volatility in fixed income markets, with pundits citing an eventual Fed rate hike as the catalyst that could give rise to further market gyrations. As the Fed moves toward policy normalization, investors are concerned that …

Markets & Economy » Puerto Rico Adds Pressure to Muni Market Outflows

September 10, 2015 | Fixed Income

Puerto Rico was thrust into the spotlight after missing a $58 million bond payment in early August. Fixed income markets stumbled on the news, but the country’s fiscal troubles should come as no major surprise. Puerto Rico’s credit rating descended to junk status during February 2014 following …

Library » The Hidden Risk of Fixed Income Indexing

June 18, 2015 | Fixed Income

Introduction Conventional wisdom is to check the oil in your car at regular intervals. While there has been some debate as to how often to change it, there is no arguing that your car’s engine couldn’t run for very long without oil. However, to say that the purpose of oil is to keep the engine …

Markets & Economy » High Yield Bonds: The Seventh Inning Stretch

July 30, 2013 | Fixed Income

It’s widely known that since the financial crisis, high yield bonds have performed strongly. Even since the “spring 2012 sell-off,” spreads have rallied approximately 275 basis points through May 2013. Yet, spreads are still approximately 225 basis points lower than before the great sell-off. …