Power Play: Betting on bonds

With thestock market (^IXIC)on track for back-to-back monthly losses, two market strategists believe it may be prudent to take a look at bonds.

“It’s important to have some bonds in your portfolio. Ride out the volatility in the market,” Dave MacEwen, co-CIO at American Century Investments, told CNBC’s “Power Lunch” on Thursday. He said it’s all about “diversification right now. Don’t worry so much about yield.”

For investors in a high tax bracket, MacEwen recommends municipal bonds. He also favors international bonds, especially ones in Europe and the UK. “There are opportunities there. ECB move is helping European corporate bonds,” MacEwen said.

Wasif Latif, head of global multi-assets at USAA Investments, is tactically underweight fixed income, but he likes investment-grade corporate bonds and high-yield bonds.

“We prefer areas of the market that are more credit-sensitive and less sensitive to changes in interest rates,” Latif said.

U.S. Treasury bonds pulled back on Thursday following the weekly report on jobless claims. The yield on the benchmark 10-year note (U.S.:US10Y) bouncing off Wednesday’s 20-month low.

You may also like...

Rules of Discussion on Power Play: Betting on bonds

1. This forum is for discussion of financial markets. Please respect others view even if they are contrary to you.
2. Member's comments should lead to value addition in forum discussion.
3. If anyone is found making repetitive Explicit/Abusive/Racial comments, his account shall be banned and old posts will be deleted.
4. Providing Advice/Recommendations/Tips is fine but it should be free. Members cannot ask to be paid for it. Paid Advice is strictly prohibited
5. Spam links are not allowed. Too much promotion or using Contact info in ID will lead to account ban.
IMP : Members are requested to flag any violations to keep Forum Clean.
Loading comments …