Hints and tips:
Related Special Reports
Borrowers on floating rates are also feeling pain. But money market funds and catastrophe bonds still have fans
...The New York-based company estimated it earned net income of about $2.7bn in the quarter, giving it a net profit margin of more than 60 per cent....
...Reits tend to pay out 90 per cent of income but anything over 100 per cent is seen as unsustainable because funds might eventually need to take on more debt, issue new shares or sell assets to fund dividends...
...The chancellor has a “secret project list” of potential revenue-raising measures for the exchequer, according to Treasury insiders, as he looks for ways to fund cuts to national insurance or income tax rates...
...As Lex wrote, “the tension between fund investors, public shareholders and employees creates a high-wire act” for them. At the other end of the fund management spectrum sits Abrdn....
...However, net inflows of $57bn disappointed, as investors remain cautious about leaving cash to go back into equity and debt markets while the US Federal Reserve keeps interest rates at a 23-year high....
...Hedge fund drama on the high seas I twisted the arm of my excellent colleague Costas Mourselas into boiling down the intriguing story he did last week with Robert Wright, about two things that never seem...
...Most private credit loans come with floating interest rates that are tied to benchmark rates. That offers protection against inflation, unlike fixed income securities....
...The Fed on Wednesday kept interest rates unchanged at their 22-year high of 5.25 to 5.5 per cent, and repeated earlier projections of three quarter percentage point cuts this year....
...Overseas development assistance budgets, which rich countries typically use to allocate cash for development banks and multilateral funds, rose to a historic high last year, according to OECD data released...
...Private investors have piled into UK government bonds this year to lock in attractive yields as the Bank of England has kept interest rates at a 16-year high....
...The rosy forecasts have “just been tossed out the window,” said Greg Peters, co-chief investment officer at PGIM Fixed Income....
...Greek banks, with floating loans and sticky deposits, have benefited from rising interest rates. They may be less sensitive to the coming downcycle....
...Moreover, low-income countries’ access to finance has come under pressure. A wave of countries has been flirting with default, as high rates have locked them out of bond markets....
...That’s because both make floating-rate loans to (mostly) junk-rated companies that aren’t quite big enough to easily tap bond markets....
...The continued popularity of income-generating ETFs, active fixed income ETFs amid interest-rate uncertainty and financial adviser interest in core strategies from firms such as Capital Group and JPMorgan...
...“From our vantage point, investors have been putting inflows into Treasury floating rate notes,” says Kevin Flanagan, head of fixed income strategy at WisdomTree....
...The quick ascent of short-term interest rates since 2022, amid high inflation and resilient economic growth, has put borrowing costs in developed markets at multi-decade highs....
...VCTs offer investors up to 30 per cent income tax relief on investments up to £200,000 per year, and tax-exempted dividends....
...While larger US companies mostly borrow long term at fixed rates through the bond market, smaller companies carry more floating-rate debt, which has become much more costly over the past two years....
...The Macquarie Income Opportunities ETF is benchmarked against the Bloomberg AusBond Bank Bill Index and invests primarily in a wide range of domestic and global investment grade floating and fixed rate instruments...
...It underscores the financial risk Blackstone assumed to draw UC’s investment by promising high returns on property investments hit by rising interest rates....
...The likes of JEPI “were built for a time when rates were very low or zero. They used the equity markets to get income that you couldn’t get from fixed income....
...high?...
...Private credit is typically floating rate and caters to relatively small borrowers with high leverage....
International Edition