Click here to find out whether mortgage REITs like Annaly mortgage, with its 15% dividend yield is safe.
In theory, that makes buying high yield this way as safe as it gets.
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Yes, high yield is overvalued, but safe money in the form of money market funds pays one or two basis points.
Shorter-term Treasuries were mixed, as the yield on the ultra-safe three-month bill fell slightly, to 0.10%, from 0.11%, while the yield on the two-year note was flat at 0.78%.
At the same time that safe assets fall in yield, the interest rates on riskier bonds will rise sharply.
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Demand for Treasurys rose as investors sought a safe haven, sending the yield on the 10-year note down to 1.915%.
However, the financial crisis in 2008 reduced returns across riskier asset classes, which resulted in investors pulling their money out and parking them in safe asset classes (low yield sovereign treasury bonds, fixed deposits, etc).
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That's a nice way of saying that during recent years the Harvard Management Company, the university's investment subsidiary, diverted large portions of the university's endowment assets out of safe but poky low-yield securities (as of last June fixed-income investments accounted for only 16% of Harvard's portfolio) and into what this Forbes story describes as "exotic financial instruments": derivatives, hedge funds, private equity partnerships, commodities and emerging-market equities.
"There's just been this grab for anything with yield that is even broader than your traditional safe havens of U.S. Treasurys and bunds, " said Eric Stein, portfolio manager at Eaton Vance Management in Boston.
Despite dividend stocks being a crowded traded these days, Stovall believe investors should pay for quality: the aristocrats feature stocks with controlled price-to-earnings ratios, safe payout ratios, and a yield between 3% and 3.25%.
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Between some semi-encouraging (as in not totally discouraging) U.S. economic data and the proclamation of ECB chief Mario Draghi in late July that the EU would do whatever it takes to keep a united currency, the 10-Year Treasury yield rose as the global appetite for a safe-haven dissipated.
Even with the lift in equities, investors were putting their money in safe government debt, pulling down the yield on the benchmark 10-year U.S. Treasury note to 3.14%, from 3.34% Monday.
A-shares is still higher than the yield on bank deposits, making shares look a reasonably safe bet.
Timid takes the safe course of action when the riskier one would yield much bigger rewards.
The UK - also seen as a safe haven - saw its 10-year bond yield fall from 2.08% to 1.97%, back below the 2% level for the first time since the New Year.
The recent run to Treasury bonds, a safe haven in times of recession, was extended, and the yield on the 10-year note fell to 3.56% from Thursday's close of 3.62%.
Given that US Savings Bonds are just as safe as the 20 year Treasury, getting almost a half-percent more yield is great.
Even the two-year, a pretty safe bet except in the most inflationary of times saw a decline in price, raising its yield to 1.83% from 1.60%.
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