Investment grade bonds power explosion in M&A

The pace of Federal Reserve rate hikes will affect the outlook for this asset class

Investment grade bonds power explosion in M&A

New bond issuance in the US investment grade (IG) market has exploded in 2015 as companies look to finance mergers and acquisitions (M&A), and Invesco Fixed Income sees no signs of this trend slowing down through the end of the year. This has consistently weighed on US IG credit spreads this year, as investors sell their current holdings to make room for new bond issues. However, the US IG market is enforcing some discipline on issuers by demanding higher yields and wider spreads in order to get new bond deals done, which means valuations in the US IG market are becoming quite attractive relative to other fixed income asset classes, in our view. This may garner a pickup in demand for the asset class over the medium term.

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An option for choppy markets

Unfamiliar with covered calls? These strategies may be just the ticket for navigating up-and-down markets

An option for choppy markets

It has been some time since the US equity market has favored a covered call strategy. Because covered calls limit an investor’s upside profit potential, strong bull markets are not the optimal environment for this strategy. Rather, a covered call strategy has the potential to work best in markets that are moving sideways or along a gentle slope up or down—much like the choppy, sideways equity market we have seen in the US throughout much of 2015.

I believe now is the time for investors to learn more about this strategy, and talk to their advisors about whether a covered call strategy is right for them.

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Have we reached the bottom of the barrel for crude prices?

A steepening crude oil futures curve paints a compelling picture for investors who are anticipating a rebound in oil prices

Have we reached the bottom of the barrel for crude prices?

“Time to Buy Commodities,” blared one business headline a few weeks back, above a story detailing just how far commodities have tumbled. Indeed, I see several reasons why investors may want to consider increasing their exposure to the oil markets.

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China’s new currency regime creates ripple effect in US Treasury market

Markets are calm—on the surface—but there may be more turmoil lurking underneath

China’s new currency regime creates ripple effect in US Treasury market

The Chinese authorities have managed to calm markets for now with accommodative moves to keep the Chinese currency and local interest rates stable, following their surprise currency devaluation on Aug. 11. But Invesco Fixed Income believes there is more turmoil than meets the eye beneath the relatively calm surface of the markets.

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Diversification is not a rising tide

In a diversified portfolio, sometimes certain assets will sink. And that’s OK — the bigger risk lies in incorrectly timing the market.

Diversification is not a rising tide

It’s official: as of Aug. 21, the Dow Jones Industrial Average entered a correction, falling at least 10% from its latest peak.1 And at the same time, many investors took a hit to their stock portfolios as well. Does that mean investors were wrong to be invested in stocks on Aug. 21?

Not at all.

Stocks traditionally serve as the “growth engine” of a portfolio — offering investors the potential to grow their wealth through the market’s returns. That’s a critical role, and investors who abandon that potential, risk falling short of their financial goals.

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Making sense of market volatility

For the first time in almost four years, the US stock market experienced a correction. Our investment leaders weigh in on what this means.

Making sense of market volatility

On Aug. 21, the Dow Jones Industrial Average entered a correction — falling 10% from its most recent peak — and reminded investors what volatility looks like after almost four correction-free years.

While volatility exposes weaknesses in the market, in my opinion it also reveals the strength of high conviction managers who are skillfully navigating the market. Active management and smart beta strategies seek to surpass the “market averages” offered by traditional benchmarks — providing the potential not only for higher returns, but also for a smoother ride.

At Invesco, that’s what we seek to do for investors: Offer high conviction strategies that help people navigate volatility and achieve their financial goals.

Here, I’ve gathered opinions from several of our senior investment leaders across equities, fixed income and alternatives, discussing their view of market volatility and how it affects — or doesn’t affect — the opportunities they see.

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