Amid a more positive outlook, consider reassessing your fixed income exposure

The consensus regarding financial markets and the economy seems to have evolved into a more benign, if not positive, outlook. Whether this optimism proves to be accurate or not, it might be a good idea for investors to reassess their fixed income exposure. I have some ETF recommendations that may work particularly well at this juncture.

For the year-to-date period ended April 30, the FTSE Canadian Bond Index was down 0.91 per cent. Bond yields eased toward the end of 2023 but started rising again in the first few months of this year. Corporate bond performance has been outstanding, and those who championed them can take a deserved victory lap. Corporate spreads have narrowed to near all-time lows. The ICE B of A Single A U.S. Corporate Index Option-Adjusted spread is only 0.75 of a percentage point. Similar corporate spread measures are also near their lows.

A long corporate bond yield may have a spread of more than 1.5 percentage points over a similar term Canada, or one percentage point over a provincial bond. If spreads are constant, the investor will earn the additional spread as income. However, if history repeats itself, as it has always done in the past, then the spread between long corporates and governments could widen by more than two percentage points.

Spread Bond United States Bonds Government Yield Canada Bank Of Canada Royal Bank Of Canada U.S. Treasuries

Canada Latest News, Canada Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Markets today: S&P 500 rally wanes amid U.S. stagflation chatterThe stock market struggled to gain much traction after data pointed to an economy that is slowing amid stubborn inflation, posing a challenge to the outlook of Federal Reserve rate cuts.
Source: BNNBloomberg - 🏆 83. / 50 Read more »

Markets today: S&P 500 runs out of steam amid stagflation chatterThe stock market lost traction and bond yields rose after data pointed to an economy that is slowing amid stubborn inflationary pressures, posing a challenge to the outlook of U.S. Federal Reserve rate cuts.
Source: BNNBloomberg - 🏆 83. / 50 Read more »

S&P 500 rallies amid quiet week for econ data: Market takeawaysStocks (^GSPC, ^DJI, ^IXIC) closed Monday's trading session on a positive note, with the S&P 500 (^GSPC) experiencing its strongest three-day rally so far in...
Source: YahooFinanceCA - 🏆 47. / 63 Read more »

After 24 S&P 500 Records, Options Traders Running Low on FOMOThere’s a frenzy-like quality to the rally on Wall Street right now that has many drawing comparisons to the stocks-only-go-up mania of the early days of the pandemic.
Source: BNNBloomberg - 🏆 83. / 50 Read more »

UBS raises S&P 500 target to Street-high 5,600Wall Street is growing more bullish on the market as UBS raises its target on the S&P 500 (^GSPC) to 5,600 from 5,400. Yahoo Finance's Josh Schafer breaks...
Source: YahooFinanceCA - 🏆 47. / 63 Read more »

S&P 500, Nasdaq futures rise as markets await inflation dataThe Kitco News Team brings you the latest news, videos, analysis and opinions regarding Precious Metals, Crypto, Mining, World Markets and Global Economy.
Source: KitcoNewsNOW - 🏆 13. / 78 Read more »