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Lots Of Money Just Came Out Of The Biggest Junk-Bond ETF
FYI: The popularity of the market’s biggest exchange-traded fund that tracks an index of junk bonds has cooled at the same time that rallies in oil and natural resources stocks abated in recent days. Bloomberg notes that the $15.9 billion iShares iBoxx High Yield Corporate Bond ETF (HYG) has seen redemptions to the tune of $2.6 billion over the past four trading sessions, the largest such streak of outflows since…. you guessed it, February, when credit markets and oil were in free fall Regards, Ted http://blogs.barrons.com/focusonfunds/2016/05/05/lots-of-money-just-came-out-of-the-biggest-junk-bond-etf/tab/print/
Lots of possible choices for big money actions, not the least being hedge funds. These folks play with a lot of money in the etf circles. My novice view thinks more hedge funds will close the doors this year; from both money leaving and plain old "don't really know what they are doing syndrome". AIG's CEO also noted verbally that the company plans to continue more purchases in the IG bonds area.
Ha! Ha! I took some off the table Tuesday and Wednesday. Since I am apparently part of the herd we probably will regret it. Junk bonds are still hovering just a few percent off historical highs on a total return basis. It's the bank loans that baffle me. They seem immune to everything. My largest holding is EVFAX and like many there have had but two or so down days since February. And EABLX below has had zero down days since February. Talk about trend persistent! Just wonder when the inevitable pullback comes in that category if it will be short and sweet or drawn out.
Hate to cherry pick dates, but since you brought up recent success with bank loan funds, take a look at PTIAX since August of 2013. I believe this was a favorite of yours with its concentration of HY Munis back in Dec of 2015.
@AndyJ first mentioned it here back in Sept of 2014.
PTIAX Yes, very trend persistent but could never go there because of the short term redemption fee. As persistent as it has been, in 2016 somewhat disappointing returns compared to many other bond categories. Even that old standby PONDX has been a tad underwhelming. Still, both are besting most of the major equity indexes ala DOW, S&P, NASDAQ, and Russell 2000 among others.
Ha! Ha! I took some off the table Tuesday and Wednesday. Since I am apparently part of the herd we probably will regret it. Junk bonds are still hovering just a few percent off historical highs on a total return basis. It's the bank loans that baffle me. They seem immune to everything. My largest holding is EVFAX and like many there have had but two or so down days since February. And EABLX below has had zero down days since February. Talk about trend persistent! Just wonder when the inevitable pullback comes in that category if it will be short and sweet or drawn out.
I think perhaps you have some recency bias on bank loans. Down past two years, and the run up has been the past few months. Same with HY, timed a buy on HYB just right and seems like I did great, and I did, but way off it's 52 wk high and many are flat or even still down over the past year in that space. All depends on when you bought.
Comments
http://www.bloomberg.com/news/articles/2016-05-05/biggest-junk-bond-etf-jolted-by-massive-redemptions-amid-rally
My novice view thinks more hedge funds will close the doors this year; from both money leaving and plain old "don't really know what they are doing syndrome". AIG's CEO also noted verbally that the company plans to continue more purchases in the IG bonds area.
http://blogs.wsj.com/moneybeat/2016/05/05/metlife-joins-aig-in-scaling-way-back-on-hedge-funds/
http://www.nasdaq.com/quotes/institutional-portfolio/bridgewater-associates-lp-699510
Regards,
Catch
http://stockcharts.com/h-sc/ui?s=eablx
Hate to cherry pick dates, but since you brought up recent success with bank loan funds, take a look at PTIAX since August of 2013. I believe this was a favorite of yours with its concentration of HY Munis back in Dec of 2015.
@AndyJ first mentioned it here back in Sept of 2014.
Nice Chart:
http://www.mutualfundobserver.com/discuss/discussion/comment/74701/#Comment_74701
I think perhaps you have some recency bias on bank loans. Down past two years, and the run up has been the past few months. Same with HY, timed a buy on HYB just right and seems like I did great, and I did, but way off it's 52 wk high and many are flat or even still down over the past year in that space. All depends on when you bought.