Floating-rate securities, securities with puts, securities where, if certain things happened, a sinking fund kicked in.
The polite term for the asset class we have in mind is floating-rate loans.
Floating-rate funds come in three varieties: open-end, closed-end and a hybrid of the two.
Other options might be high-yield bonds, floating-rate debt, cash, commodities, or real-estate income producing properties.
FORBES: How to Protect Your Portfolio from Rising Interest Rates
One area that provides protection against rising rates is floating-rate bonds, notes Ms. Bewick.
WSJ: As Many Stocks and Bonds Get Pricey, It's Time to Play Defense
Investors who like the idea of floating-rate funds but not bank loans have a few other options.
But still, an all-debt floating-rate purchase does bring back memories of the bad old days of real estate.
On floating-rate debt, the yields can adjust and allow investors to get paid more in a rising-rate environment.
WSJ: As Many Stocks and Bonds Get Pricey, It's Time to Play Defense
Mr Brown will not find it much easier to wean Britain's borrowers off their fixation on floating-rate loans.
An era of austerity, which the floating-rate system was designed to avoid, is going to occur after all.
ECONOMIST: The link between exchange rates and asset markets
Floating-rate, rather than fixed-rate, exchanges are going to require the holding of customer funds in national currencies.
FORBES: Bitcoin's Greatness Not Realized By Succumbing To Regulation
That is one reason why even in floating-rate regimes, governments pay attention to the value of their currencies.
Still, floating-rate bond funds may be the best fixed-income deal available in an environment of rising short-term interest rates.
Looking ahead, managers say capital continues to pour into the market from all quarters as investors look for floating-rate, wide-margin opportunities.
FORBES: Year-end and January Analysis - US Leveraged Loan Market
Instead of TIPS, Corso is advising clients to buy floating-rate corporate bonds.
Floating-rate funds are pools of bank loans made to companies, and the interest rates on those loans adjust as interest rates change.
FORBES: 5 Reasons Why Bond Funds Can Help You Navigate Bond Market Headwinds Successfully
Most are familiar with CPI-linked bonds such as TIPS or floating-rate bonds.
Take, for example, one indicator of the market's appetite for risk, the spread between swaps of fixed- and floating-rate interest payments (see chart).
Things like that could be something as simple as non-traded real estate investment trusts, or secured floating-rate income, as opposed to fixed income or bonds.
Morley touted floating-rate bank instruments, multifamily real estate or farm land.
But a floating-rate system is not a free lunch either.
ECONOMIST: The link between exchange rates and asset markets
And Apple sold floating-rate bonds that mature in three and five years at rates of 0.05 and 0.25 percentage point over the three-month London interbank offered rate, an industry benchmark.
Floating-rate mortgages last year reduced many borrowers' payment burden as the Bank of England dropped its base rate to 0.5% and lenders adjusted their standard variable rates downward in response.
The company estimates that the savings from interest payments -- a big chunk of the borrowings carry floating-rate terms -- would make up for the foregone profits from the sold assets.
Another reason demand for the long bond has been so voracious is that a lot of investment banks still use them to hedge their corporate-bond positions and interest-rate swaps (between fixed- and floating-rate obligations).
For individuals the good news is that there are mutual funds that make it easy to invest in diversified portfolios of floating-rate loans, mostly made by banks to corporations with less than investment-grade bond ratings.
The levels of fixed-rate debt and floating-rate debt should come down, and the coverage ratios should improve in the next year or two, says General Growth Chief Financial Officer Bernard Freibaum Bernard Freibaum in a conference call with investors today.
Berry likes the similar Eaton Vance Floating-Rate Fund, yielding 1.9% after expenses of 1.8%, for its "steady performance and proven management" and the no-load Fidelity Floating Rate High Income Fund, which is returning 2.9% after expenses of 0.9%.
The levels of fixed-rate debt and floating-rate debt should come down, and the coverage ratios should improve in the next year or two, says General Growth Chief Financial Officer Bernard Freibaum in a conference call with investors today.
Where floating-rate loans and stocks rode higher in March, fixed-income securities trended lower as stronger economic tides pushed up 10-year Treasury yields by 24 bps, to 2.21% on March 31, from 1.97% a month earlier, according to Bloomberg.com and the Federal Reserve.
应用推荐