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Diversification: Corporate bonds come in a wide variety of types, depending on maturity (short, medium and long) and rating quality (investment-grade or high-yield). A bond ETF allows you to buy ...
All three ETFs hold corporate bonds with no lower than an investment grade BBB rating. Consequently, this corporate bond ETF holds relatively low-risk assets and trades on a 4.5% yield. However ...
A big gap exists between this earnings yield and BBB-rated corporate bonds as well. Both point to a historically expensive stock market that could be poised to fall with any significant bump in ...
If the corporate debt bubble bursts, the bonds would be repriced, resulting in a massive loss by the mutual funds, high-yield funds, pension funds, and endowments with corporate bond assets. As with the 2008 crisis, this may result in increased caution by lenders and the shrinking of the entire bond market , resulting in higher rates for ...
The credit rating is a financial indicator to potential investors of debt securities such as bonds.These are assigned by credit rating agencies such as Moody's, Standard & Poor's, and Fitch, which publish code designations (such as AAA, B, CC) to express their assessment of the risk quality of a bond.
Municipal bonds, and Treasury Inflation-Protected Securities are excluded, due to tax treatment issues. The index includes Treasury securities, Government agency bonds, Mortgage-backed bonds, Corporate bonds, and a number of foreign bonds traded in U.S. The Bloomberg US Aggregate Bond Index is an intermediate term index.
Still, the bond markets are raising interest rates by selling bonds -- the benchmark 10-year Treasury yield is higher than when the Federal Reserve cut rates. 10 Year Treasury Rate Chart 10-Year ...
BBB BBB− BB+ BB BB− B+ B B− CCC+ CCC CCC− RD. For Fitch, a bond is considered investment grade if its credit rating is BBB− or higher. Bonds rated BB+ and below are considered to be speculative grade, sometimes also referred to as "junk" bonds. [104]