Head of Fixed Income, Portfolio Manager
Head of Fixed Income Mike Sanders joined the Schwab Network to discuss the Fed’s rate-cut outlook amid delayed jobs data and the balance between inflation and employment. As he noted, the Fed is likely to “favor the labor market vs. inflation” in the near term.
Upon request, Madison may furnish to the client or institution a list of all security recommendations made within the past year.
Bond Spread is the difference between yields on differing debt instruments of varying maturities, credit ratings, and risk, calculated by deducting the yield of one instrument from another.
Diversification does not assure a profit or protect against loss in a declining market.
Duration is a measure of the sensitivity of the price of a bond or other debt instrument to a change in interest rates. Duration measures how long it takes, in years, for an investor to be repaid the bond’s price by the bond’s total cash flows.
The federal funds rate is the target interest rate range set by the Federal Open Market Committee (FOMC) for banks to lend or borrow excess reserves overnight. It influences monetary and financial conditions, short-term interest rates, and the stock market.
Mortgage-Backed Securities (MBS) are bonds made up of a collection of residential or commercial mortgages.
Yield Curve is a line that plots yields (interest rates) of bonds having equal credit quality but differing maturity dates. The slope of the yield curve gives an idea of future interest rate changes and economic activity. There are three main types of yield curve shapes: normal (upward-sloping curve), inverted (downward-sloping curve), and flat. A flat yield curve is one in which short-term bonds have yields similar to longer bonds.
