INSIGHTS

Convertible Bonds and Volatility

Convertible bonds and volatility go hand in hand given the optionality embedded in a convertible security. At times convertibles act more like stocks and at other times more like bonds. This paper explores that concept and the thesis that higher volatility as expressed by the VIX(1) has historically been a positive for convertible bond performance relative to the S&P 500 Index and a 60% equity/40% fixed income mix(2).

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High Yield – High Risk, Low Return

Greg Miller CPA, CEO & Portfolio Manager
Michael Miller, President & CIO
Jim Buckham CFA, Portfolio Manager
Howard Needle, Portfolio Manager

With high yield coupons or current yields at historically low levels, the perceived credit worthiness of high yield issuers is extremely optimistic as evidenced by historically tight credit spreads and Treasury rates at very low levels. As such it may be challenging for high yield investors to achieve attractive risk-adjusted returns over the foreseeable investment horizon.

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Sweet Spot Investing with Convertible Bonds

Jim Buckham CFA, Portfolio Manager

Convertible bonds are sometimes considered the “Swiss Army knife” of financial products because they can provide investors with principal protection (barring default), income, and equity-like returns.

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Bull, Bear and Upside-Down Markets

By Jim Buckham CFA, Portfolio Manager

An informative historical review of bull and bear markets leading up to the present state of our global economy

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