U.S. Bonds - On My Radar Screen

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U.S. Bonds

U.S. - ISHARES Bonds: 1 month intervals, page loads slow.
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ISHARES TRUST IBOXX USD HIGH YIELD CORPORATE BOND ETF

ISHARES TRUST IBOXX USD INVESTMENT GRADE CORP BOND ETF

ISHARES TRUST CORE US AGGREGATE BD ETF

ISHARES TRUST US TREASURY BOND ETF

ISHARES US ETF TRUST INT RATE HEDGED EMERGING MKTS BD ETF

ISHARES TRUST TIPS BD ETF

ISHARES TRUST 0-5 YEAR TIPS BD ETF

ISHARES TRUST SHORT TERM NATIONAL MUNI BOND ETF

ISHARES TRUST AAA - A RATED CORP BD ETF

ISHARES INC J P MORGAN EM HIGH YIELD BOND ETF

ISHARES TRUST 10-20 YEAR TREASURY BD ETF

ISHARES TRUST AGENCY BD ETF

ISHARES TRUST INTERMEDIATE GOVERNMENT/CREDIT BOND ETF

ISHARES INC JP MORGAN EM LOCAL CURRENCY BOND ETF

ISHARES INC J P MORGAN EM CORPORATE BOND ETF

ISHARES TRUST NEW YORK MUNI BOND ETF

ISHARES TRUST GOVERNMENT/CREDIT BD ETF

ETF

Bonds

High Yield Bond Funds:
There are both actively and passively managed funds that invest in several different types of high-yield instruments. These funds invest in issues that have been rated below investment grade by analysts and therefore pay a higher rate of interest.

Foreign Bond Funds:
Many of the funds that purchase bonds issued by foreign investors also offer higher yields than comparative domestic issues. Some of these funds also focus on high-yield holdings in other countries while others invest more broadly, but the additional risk that comes from any type of international investing often comes with a superior yield

Municipal Bonds:
Bond fund investors in the top tax brackets will often get a higher yield from funds that purchase muni offerings that pay tax-free interest. Some muni funds invest nationwide and pay interest that is only exempt from federal taxation, while others focus on a specific state or locality and offer double or triple tax-free interest.

TIPS funds:
These funds seek to at least keep up with inflation by purchasing Treasury Inflation Protected Securities, a special type of government bond that pays an interest rate which is periodically adjusted for inflation based upon the Consumer Price Index.
These bonds come with a full guarantee of principal and therefore carry less risk than other types of bonds that can keep up with inflation.

Don’t Buy in November:
Most mutual funds (regardless of what they invest in) distribute the capital gains that they have accumulated over the past year to the current shareholders in the month of November. This means that those who buy taxable funds in this month will get a bill for their share of capital gains that the fund has incurred in the previous 12 months, even though they didn’t own the shares at that time.

Convertible Bonds:
Do you enjoy the potential upside of the stock market, but want some of the protection that bonds can give? Convertible bonds, or converts as they are typically called, are a great way to play both sides of the coin.

Like traditional bread-and-butter bonds, converts have face values, coupon payments and maturity dates. However, convertible bonds have a special feature: they can be exchanged for a specific number of shares of the issuer’s common stock at a later date.

This generally happens when the price of the firm’s shares hit a certain predetermined amount. This provides investors the potential to play both a company’s debt and equity via a single security.

Treasury:
When Treasury Bonds Perform Well
Because these securities have such little risk, their performance is typically influenced almost entirely by interest rates. In a falling rate environment, Treasury securities will see their prices increase.

When Treasury Bonds Perform Poorly
An environment in which interest rates are rising will decrease the price of a Treasury security, though that means that their yield will increase at the same time.

Investment Grade Corporates:
When Investment Grade Corporates Perform Well

This is typically on a case-by-case basis. Interest rates will certainly have an impact on the bonds, but investors will want to keep a close eye on the company to get an idea for how the bond will perform. A company that reports a solid financial position will likely see a positive performance for their debt securities.

When Investment Grade Corporates Perform Poorly

On the flip side, if it is discovered that a company has gotten in a bad way financially, bond prices could take a hit.
Global risk perception can also play a big role; if investors begin to perceive that markets are becoming more volatile and risky, they may sell out of corporate debts in favor of Treasuries, thus decreasing the price of some corporate securities.

Junk Bonds:
When Junk Bonds Perform Well Similar to corporates, junk bonds will perform well when there is evidence of sound financials from the underlying entity. Like every bond, interest rates will also play a role.

When Junk Bonds Perform Poorly
Signs of financial distress or weakness from the issuer will drag down the price of these securities.

Aggregate Bond Index:
Is an index used by bond traders, mutual funds, and ETFs as a benchmark to measure their relative performance.
The index includes government securities, mortgage-backed securities (MBS), asset-backed securities (ABS), and corporate securities to simulate the universe of bonds in the market.
The index functions in a similar manner for the bond market to what the S&P 500 index or Dow Jones Industrial Average (DJIA) does for the equity market.

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