Avoid Long-Dated Corporate Bonds
https://seekingalpha.com/article/4585197-vclt-avoid-long-dated-corporate-bonds — Investors might roll up the yield curve to shorter dated bonds, avoid LT Bonds, especially given credit risk spreads.
Porchester 🔺's avatar
I would have to disagree somewhat here. Although I agree shorter-term bonds offer better risk-reward (particularly treasuries right now) than longer-dated bonds, with longer-dated treasury yields comfortably above 3.5% and spreads where they are longer-dated credit in my opinion offers much better risk-reward than equities.

With S&P 500 offering fw earnings yield of 5.2% (and equities looking expensive overall), and the Bloomberg US Corporate Agg having a yield to worst of 5.5%, I know where I would rather have my money invested right now.
Pearl Gray Equity and Research's avatar
@porchester You are comparing an earnings yield to a risk premium. Apples and pears. Moreover, It’s simply suggested that your roll up the curve because that is what most portfolio managers are busy doing, meaning you can ride the wave.



Already have an account?