Monthly dividend paying stocks can be an appropriate complement to other monthly-paying securities like closed-end bond funds.
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But in most cases, I think I have a better chance at limiting risk (and ideally boosting returns) by sticking with open-end bond funds like DoubleLine Core Fixed Income (DLFNX), DoubleLine Total Return (DLTNX), Thompson Bond (THOPX), PIMCO Income (PONDX), and PIMCO Foreign Bond US Hedged (PFODX).
The four iShares index funds (see table below), issued by the Global Investors unit of Barclays (nyse: BCS - news - people ), sport a rock-bottom expense ratio of 0.15 versus open-end bond fund averages of around 1.00 and the 0.20 charged by low-cost leader Vanguard.
Similarly, not long ago many bond market gurus were predicting the end of high bond prices.
So what should bond investors, especially retirees, be on the look out for as far as an end to the bond market ride?
Worse, two little-noticed but important bits of the market have imploded this month, and there are fears for a third, known as closed-end municipal-bond funds.
Although the Fed is trying to limit the surprise of an end to its bond-buying program, there is a more likely event that officials will have to increase it to support a weakening economy, Nichols added.
By tuning the laser very precisely to the frequency of one particular sort of bond (such as that with a heavy carbon atom at one end), a molecule containing that bond can be shaken up.
The end of national government-bond markets may hurt just as much.
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In spite of this, municipal bond closed-end funds are attractive.
However, bond funds carry annual expenses, upfront or back-end commission charges and, if interest rates rise, bond fund holders can lose principal.
Some Federal Reserve officials have also been calling for an early end to the central bank's bond-buying program.
Investors were jarred by the potential for an earlier-than-expected end to the Fed's experimental bond-buying programs, known as quantitative easing.
Those minutes reveal that several FOMC committee members think that with the economic recovery showing increasing strength, the Fed will need to halt the bond purchases well before the end of 2013.
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While bank lending remained an important source of financing, companies of all sizes and all credit ratings had the option of accessing the bond markets and, by the end of the 1980s through the issuance of high yield securities, a different universe of creditors.
It could be an issue, however, for a stock, bond, ETF, or closed-end fund that is not frequently traded.
Quite possibly, but I see a crucial difference between the end of 2012 and the end of 2011: The ECB's government bond-buying program, announced earlier this year.
My policy on bond investing is to only use open-end no load Institutional class mutual funds to invest in bonds.
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