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Income Investing in Uncertain Times
The current market presents a complex mix of optimism and pessimism, creating unique opportunities for income investors in various asset classes.
English
Canada
Labour MarketRiskMarketInvestingBondsIncome
Cibc Asset ManagementBank Of CanadaU.s. Federal ReserveFidelityPimco
David WongEric MollenhauerAlfred Murata
- What is the current state of income-oriented investment strategies?
- Income-oriented strategies are making a comeback after a difficult period of high inflation and rising interest rates. Financial, utilities, and real estate stocks, all dividend producers, have performed well recently.
- What is the current state of the yield curve, and what does it indicate?
- While the yield curve is no longer inverted overall, it remains inverted at the short end, reflecting uncertainty about interest rates, inflation, and the economy. This uncertainty presents both risks and opportunities.
- How does the current market environment affect income investment opportunities?
- The current market reflects a push and pull between optimism and pessimism, creating income opportunities in unexpected places, such as leveraged loans and mortgage-backed securities.
- What is a key factor for long-term fixed income return, and why is it important?
- Experts highlight the importance of starting yield as a key indicator for long-term fixed income returns, emphasizing the need to consider current conditions when making investment decisions.
- What are some alternative income investments currently showing promising yields, and why?
- Floating rate funds, which outperformed in 2022 and 2023, are still performing well but could be negatively impacted if short-term rates fall. Higher yields are available in mortgage-backed securities and leveraged loans due to factors such as investor pullback.