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The AAII Los Angeles Chapter presents...
"Changing Policy and Rising Rates: Good for Investors"
"Interest Rates vs. Income Generation: An Opportunity in Today’s High-Yield Market"
Chief Investment Officer, Peritus Asset Management
As we begin 2014, the consensus appears to be that Fed tapering will lead to higher interest rates. While this may happen, Tim Gramatovich questions the sustainability of another significant move in rates in 2014, as the 10-year Treasury has already almost doubled in yield between May 2013 and year-end 2013. Countries that have no quantitative easing programs have lower yields on their government bonds and demand is likely to increase, constraining rates. Gramatovich sees the high-yield market as positioned well in this environment and this asset class deserves attention as a source of income. He expects that in 2014, active management in the high-yield market will be required.