SPDR DB International Government Inflation-Protected Bond ETF (WIP)
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- Bond Wars Update: International and Junk [view article]
- Argentina to Default? [view article]
- A Lazy ETF Portfolio Underweighting the U.S. [view article]
- Where Are India’s Innovative Companies, Products and Solutions? [view article]
- Global Price Increases Offer Several Investing Solutions for Inflation [view article]
- ETF Industry Data Summary: 1H'08 [view article]
- The White Elephant That Could Destroy Your Portfolio, Part I [view article]
- Packaging Inflation-Linked Bonds [view article]
- The White Elephant That Could Destroy Your Portfolio - Part II [view article]
- Inflation Protection Ideas [view article]
- Positioning For Further Dollar Weakness [view article]
- ETF Update: Credit Default ETFs, High Put/Call Options Ratios, Backtesting, Short Gold ETN [view article]
loading ...Recent WIP Articles
- Bond Wars Update: International and Junk
- A Lazy ETF Portfolio Underweighting the U.S.
- Global Price Increases Offer Several Investing Solutions for Inflation
- ETF Industry Data Summary: 1H'08
- Tuesday Outlook: Financials Under the Gun
- Packaging Inflation-Linked Bonds
- The White Elephant That Could Destroy Your Portfolio - Part II
- The White Elephant That Could Destroy Your Portfolio, Part I
- The Most Successful ETF Launches of 2008 (So Far)
- Inflation Protection Ideas
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Bond Wars Update: International and Junk [view article]
Doubling down is a risky strategy, although I have used it successfully in the past. It does lower your average share price and if a recovery occurs, your profits are enhanced. I'm not certain about PCY's prospects for recovery as far as timing. There is great turmoil in the markets now. I would certainly never recommend it--just point out the risks and leave it to you. My risk preferences are probably much more conservative than yours.However, I am bullish on emerging markets over the long haul. Russia and Turkey have a lot of room to grow, but it's going to be bumpy. My concern in Russia is the fate of the ruble. It is mostly a free floating currency, as far as I know. It could take a huge hit if the political situation there gets much worse.
Good luck. Reply
Bond Wars Update: International and Junk [view article]
Also, approx. 11% of EMB is Russian and over 8% is Turkish debt. Makes no sense. Seems like a big holder had no choice but to liquidate and caused the slip. Is this a buy? I hold PCY and am considering buying more. Thoughts? ReplyBond Wars Update: International and Junk [view article]
PCY's debt is also USD denominated. ReplyBond Wars Update: International and Junk [view article]
Greg: Remember that EMB holds only dollar denominated debt. So there is no currency risk. There is, of course, credit risk, but when a foreign government issues dollar denominated debt it is usually a higher credit quality. While this fund will not capture any currency gains, neither will it lose to currency falls.Also, with regard to trading below NAV, I suspect that since the Russian exchanges have been unable to trade for a few days, there is no reliable way to evaluate their debt obligations. When trading opens again, which I am sure it will, then we will get a better understanding of the value of the ruble and the value of their securities. Until then, the market apparently holds a dim view of their real value.
Reply
Skidmore
Bond Wars Update: International and Junk [view article]
Also interesting is the EMB is not trading this way. The portfolio do not look that different so this seems to be a PCY issue. ReplySkidmore
Bond Wars Update: International and Junk [view article]
It looks like PCY is trading at a discount to NAV. Can anyone confirm my logic? It's been this way for several days. I spoke to PowerShares and they seem clueless. These quotes are from yahoo.^PCY-NV 23.26
^PCY-IV 22.95
PCY 20.20
On Sep 18 01:03 PM rayhendon wrote:
> Looking at the detail of their holdings, it looks like the death
> list of an airlines crash where there no survivors. Chilean debt
> is their largest holding, and the Chilean economy and currency has
> been besieged lately. This is also true for most of Latin America.
> Then they have Bulgaria, Hungary and Turkey--two of which (Hungary
> and Turkey) have currencies under severe attack. I don't have good
> data on Bulgaria, but it is a former vassal state of Russia, with
> little experience in modern capitalism.
>
> Then, they have over 4.5% invested in Russian bonds. Russia's equity
> market has been forced to close for the last two days, attributable
> to the meltdown of some of their largest banks--all are severely
> undercapitalized (like the U.S. banks, only more so), and the ruble
> has been vanquished.
> I have no time table for when any of these collapses will conclude.
> At the edges of the financial world, all these countries, indeed
> almost all emerging markets except China and India are suffering
> greatly as the world's investors try and get a grip of what's happening.
> I don't think there is going to be any fast recovery for them. But,
> when they do recover, it will be twice or three times the rate of
> developed economies. The volatility of emerging markets equities,
> currenies and debt is exceptional. You must be prepared to take some
> big lumps if you get into these investments. Personally, I have confidence
> that most of those I listed will recover. Their economies have far
> to go on the upside. But their fairy tale growth has ended for now,
> and it may be some months before all the commotion settles down.
>
> For now, there is an international flight to quality--can you believe
> U.S. Treasuries? They are still the prime debt instruments in the
> world.
>
> Best wishes,
>
> Ray
> Ray Reply
Bond Wars Update: International and Junk [view article]
Looking at the detail of their holdings, it looks like the death list of an airlines crash where there no survivors. Chilean debt is their largest holding, and the Chilean economy and currency has been besieged lately. This is also true for most of Latin America. Then they have Bulgaria, Hungary and Turkey--two of which (Hungary and Turkey) have currencies under severe attack. I don't have good data on Bulgaria, but it is a former vassal state of Russia, with little experience in modern capitalism.Then, they have over 4.5% invested in Russian bonds. Russia's equity market has been forced to close for the last two days, attributable to the meltdown of some of their largest banks--all are severely undercapitalized (like the U.S. banks, only more so), and the ruble has been vanquished.
I have no time table for when any of these collapses will conclude. At the edges of the financial world, all these countries, indeed almost all emerging markets except China and India are suffering greatly as the world's investors try and get a grip of what's happening. I don't think there is going to be any fast recovery for them. But, when they do recover, it will be twice or three times the rate of developed economies. The volatility of emerging markets equities, currenies and debt is exceptional. You must be prepared to take some big lumps if you get into these investments. Personally, I have confidence that most of those I listed will recover. Their economies have far to go on the upside. But their fairy tale growth has ended for now, and it may be some months before all the commotion settles down.
For now, there is an international flight to quality--can you believe U.S. Treasuries? They are still the prime debt instruments in the world.
Best wishes,
Ray
Ray Reply
Bond Wars Update: International and Junk [view article]
PCY is down anoth 6.5% today - thats more than 20% for the week.Any links or info would be appreciated.
Thank you Reply
investor
Bond Wars Update: International and Junk [view article]
I second that. Can someone explain the large decline in PCY. My belief is that the Russian stock market collapse as well as fears about Argentina's stability at least in part caused the selloff...More views please ? ReplyBond Wars Update: International and Junk [view article]
Hi. Can you say something about what happened to PCY today (down 13.25%). Thanks!Reply
Bond Wars Update: International and Junk [view article]
Turbo Grande:You are correct about EMB. This fund does buy only U.S. dollar denominated debt. My apologize for my error in my first response.
Thank you for the information.
Ray Reply
Bond Wars Update: International and Junk [view article]
We buy them with dollars, but the sponsor buys them in local currencies. Even if they didn't, however, fluctuation in the exchange rate between the two currencies would be reflected in the NAV. There is no escaping the currency risk unless you hedge the amounts.Best wishes,
Ray Reply
Bond Wars Update: International and Junk [view article]
If I'm not mistaken, Emerging Market bonds (like those held by PCY) are dollar-denominated and therefore not subject to currency fluctuation issues. ReplyArgentina to Default? [view article]
So, is argentina going to default?should i take my money out of the banks??
how soon?
Argentina is a mess up country anything could happend. Reply
sula
A Lazy ETF Portfolio Underweighting the U.S. [view article]
I agree with adding PCY, some FRN, PSP, and PFP. One can make a case for GLD as a subset of the commodities allocation, since gold is not only a commodity. Also, there's evidence that annual rebalancing is far more effective than monthly rebalancing (check out PIMCO website for article making case for commodities in portfolios to reduce overall portfolio risk - apparently monthly rebalancing greatly diminishes the effectiveness of this allocation strategy). I rebalance bi-annually, with good results. Reply