white papers
Spread Levels Matter
While investors have welcomed the return of yield to bond markets, the level of additional yield over Treasuries (“spread”) remains historically tight. In our latest bond white paper, we discuss why spread levels matter.
Read MoreCorrelation: The Importance of Quality in Fixed Income Allocations
In portfolio construction, understanding how each investment or asset class complements one another can be your most valuable ally. Correlation can be analyzed between asset classes but also between segments of the same asset class. Within fixed income, for instance, credit quality will often dictate the relationship between a bond portfolio and the equity market.
Read MoreMunicipal Bonds
Municipal bonds make up nearly 7% of the investment grade bond market. The $4 trillion in municipal debt is issued by government entities to cover expenses and finance projects that significantly benefit the public. This paper provides an overview of Municipal Bonds, highlighting their tax advantages, illustrating with examples, and exploring their intricacies.
Read MoreMid Cap Equity: A Strategy Designed for All Seasons
The U.S. equity market offers diverse investment opportunities, from large, stable companies to fast-growing startups. While many investors focus on large, well-known companies or chase the allure of high-growth startups, mid cap stocks are often overlooked. However, mid-caps deserve your attention, as they have delivered higher risk-adjusted returns over the long term than both small and large caps.
Read MoreWhy Accept More Risk for Comparable Yield?
As interest rates attract investors back to fixed income, investors must consider the risk and return tradeoff in their allocation and ensure they are adequately paid for risks, particularly duration. Many assume that longer-duration strategies will offer greater yield and total return potential than intermediate-term strategies. However, analysis of current valuations and historical performance patterns tells a different story.
Read MoreCash and Money Market Funds vs. Bonds: Which is Better?
For much of 2023 and 2024, investors could earn the same, if not a higher yield by staying in cash than what much of the bond market offered. Coming into 2025, bond yields had reverted back to normal, yet an uncertain economic environment kept many investors in their cash allocations. While both financial instruments are perceived to be “safe,” investors should consider two important factors when determining which is best for their portfolio: total return potential and reinvestment risk.
Read MoreCredit Analysis
History has taught us that even highly-rated bonds can quickly experience deteriorating credit quality and wreak havoc on a portfolio. Naturally, credit quality becomes a focus in weakening market conditions, but the importance of credit research in all market conditions must be considered.
Read MoreEmbracing the Return to Normal: Bond Markets in 2025
After a disappointing 2024, we believe bond markets are once again being driven by fundamentals rather than Fed intervention. With a positively sloped yield curve and structurally higher rates, new opportunities are emerging for investors.
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“Madison” and/or “Madison Investments” is the unifying tradename of Madison Investment Holdings, Inc., Madison Asset Management, LLC (“MAM”), and Madison Investment Advisors, LLC (“MIA”). MAM and MIA are registered as investment advisers with the U.S. Securities and Exchange Commission. Madison Funds are distributed by MFD Distributor, LLC. MFD Distributor, LLC is registered with the U.S. Securities and Exchange Commission as a broker-dealer and is a member firm of the Financial Industry Regulatory Authority. The home office for each firm listed above is 550 Science Drive, Madison, WI 53711. Madison’s toll-free number is 800-767-0300.
Any performance data shown represents past performance. Past performance is no guarantee of future results.
Non-deposit investment products are not federally insured, involve investment risk, may lose value and are not obligations of, or guaranteed by, any financial institution. Investment returns and principal value will fluctuate.
This website is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security and is not investment advice.
Any performance data shown represents past performance. Past performance is no guarantee of future results.
Non-deposit investment products are not federally insured, involve investment risk, may lose value and are not obligations of, or guaranteed by, any financial institution. Investment returns and principal value will fluctuate.
This website is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security and is not investment advice.