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FDD

With interest rates at record lows and expected to remain depressed for the foreseeable future, investors have been forced to get creative in their hunt for current return. Some have shifted domestic fixed income holdings along the risk/return continuum, seeking out more attractive yields from junk bonds. Others have ventured beyond the U.S. borders, embracing emerging market bonds as a higher-yielding alternative to Treasuries. Equities have also emerged as a potential source of current return, with the dividend yield on many stocks exceeding the yield on fixed income securities. Billions of dollars have flowed into exchange-traded products focusing on the MLP sector of the domestic energy market, thanks in part to yields in the neighborhood of 6% on these securities [see MLP ETFs: Fact And Fiction]. [click to continue…]

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Europe ETFs: All Over The Board

by Michael Johnston on July 28, 2009

Over the past several months, concerns over the fallout from the massive stimulus plans, rising unemployment, and continued weakness in corporate earnings have left many investors rethinking their allocations to U.S. equities. Once considered an essential element of any portfolio, American stocks have fallen out of favor with some investors who have shifted assets towards emerging markets and other regions (the number of ex-U.S. ETFs available is a testament to this trend). For investors disillusioned with prospects for American markets but unwilling to take on the risk inherent in emerging and frontier market funds, Europe may present an appealing option. Although the region has its share of economic turmoil (Ireland and the UK have been hit particularly hard), many investors believe the region’s economic prospects are much brighter than those of the U.S. And with green shoots now appearing throughout Europe, these ETFs may become more popular among U.S. investors seeking exposure to developed markets. But a word of warning: all Europe ETFs are not created equal. [click to continue…]

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