Other Asset Classes
Most investors are familiar with the more traditional forms of investing, such as stocks and bonds. However, an increasing number of investors desire alternative assets with which to grow their money.
Category: Investing
Funds
Funds, in terms of investing, are supplies of capital that belong to multiple investors. This capital collectively purchases securities. Each investor in a fund retains ownership and control of his or her own shares. Funds grant investors a broader selection of investment opportunities than they would normally enjoy on their own, as well as the benefit of professional management of the investment. The fees associated with trading the securities procured by an investment fund also tend to be much lower than individual investors would generally be able to obtain investing on their own.
Bonds
What are Bonds and why are They Important?
Bonds are one of the most important but misunderstood parts of the financial industry, partly because there are so many different types that serve different purposes. Bonds have received extra attention since the Financial Crisis in 2007 and 2008. Bonds are loans issued primarily by governments and corporations.
Watching the Euro and Bunds Go Their Separate Ways?
Previously there was a good fit between the direction of German bund yields and the euro as this great graphic from Bloomberg illustrates. However, recently the relationship appears to be loosening. Consider that over the past week, the 10-year bund yield is up 3 bp and that is with yesterday’s 3 bp decline. The euro has fallen 1.1% over the same period.
Small-cap Stocks Still Outperforming S&P 500
Stock markets have shown some interesting trends so far in 2015, and most of those trends have been bullish in nature. However, some stock sectors have benefited more from this optimism than other sectors, and the overall developments might be surprising those most heavily invested in traditional assets. If we look at the major financial news headlines, most of the attention has been on indices like the S&P 500 or the NASDAQ 100 (which recently surpassed highs not seen since the tech bubble of 1999). However, when we compared the year-to-date performance of these bench
Government Bonds Selling Quickly as Economies Improve
In the wake of the 2008 Global Recession, bonds became a favorite investment. Their safe returns on investment offered those contemplating retirement the type of security that they no longer felt banks could offer after a spate of failures. This led to the unusual situation of negative yields, where bonds sold for more than their yield values simply because investors wanted a way to safeguard most of their money.
A Currency Model for Pacific Nations to Foster Stable Economic Growth
The Pacific developing member countries (DMCs) of the Asian Development Bank are a heterogeneous group of economies with different levels of economic development and economic size. However, when it comes to choosing an optimal exchange rate, the Pacific DMCs face similar challenges.
Catching Up with the Currencies
The US dollar has begun the new week on firm footing. It remains, though, largely in the ranges seen in the second half of last week. Sterling is the notable exception. Last week’s sharp downside momentum has continued, pushing the sterling to $1.52. The softer than expected manufacturing PMI gave the bears cover, even though it improved from 51.8 to 52.0, the market had expected a 52.5 reading.
The Arguments for a Floating Renminbi Strengthen
The Peoples’ Bank of China (PBoC) has maintained a close relationship between the renminbi (RMB) and the US dollar since the RMB was first pegged in 1994. Twenty years on, after the PBoC has made the RMB somewhat more flexible, pegging it to a genuine broad trade-weighted basket would promote stability for China and its trading partners.
A Penny for your Thoughts on the Pound
Sterling has fallen out of favor. It was the market’s darling, rallying from $1.4565 in mid-April to $1.5815 in mid-May. From a technical point of view, it was correcting the slide from last July’s test on $1.7200. The fundamental trigger for the correction was the weaker US dollar environment, which was partly spurred by disappointing Q1 data. The unexpected majority victory by the Tories also helped fuel sterling gains.
