Issues to consider when investing in high yield products
~ Why is the investment high yield — where does this additional yield come from?
~ What are the main risks associated with the investment?
~ What is the risk profile attached to the different high yield instruments, and is the investment considered growth or defensive?
~ Should you make specific allocations to high yield investments, or invest in a diversified fixed income product and leave the manager to decide on the allocation to high yield?
~ What signals are relevant when considering making an allocation or increasing your allocation to high yield investments?
~ If considering a particular bond issue, ask about the price and expected yield; the maturity date, and if the bond can be redeemed early; the credit rating, and what this means for risk; and the price.
Source: Mercer Wealth Solutions
Recommended for you
In this week’s episode of Relative Return Insider, hosts Maja Garaca Djurdjevic and Keith Ford discuss a busy week of announcements from ASIC, with submissions to its public and private markets paper made (mostly) public.
In this week’s episode of Relative Return Insider, AMP chief economist Shane Oliver joins the show to unpack Australia’s underwhelming March quarter GDP figures and what they signal for the Reserve Bank’s next move.
The latest episode of Relative Return sees host Laura Dew chat with Brian Jones, founder of outsourcing company VA Platinum, on why choosing to outsource certain functions of your business can enable you to be efficient and productive.
In this episode of Relative Return Insider, hosts Maja Garaca Djurdjevic and Keith Ford are joined by Money Management editor Laura Dew to discuss learnings from JP Morgan’s recent conference in London, and what top fund managers and analysts see driving market behaviour.
