Why floating rate

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For additional disclosure information on any security listed in this publication, please contact a Raymond James financial advisor. RJA and is not a complete summary or statement of all available data, nor is it to be construed as an offer to buy or sell any securities referred to herein. Trading ideas expressed are subject to change without notice and do not take into account the particular investment objectives, financial situation or needs of individual investors.

Investors are urged to obtain and review the relevant documents in their entirety. RJA is providing this communication on the condition that it will not form the primary basis for any investment decision you may make. Furthermore, because these are only trade ideas, investors should assume that RJA will not produce any follow-up.

Employees of RJA or its affiliates may, at times, release written or oral commentary, technical analysis or trading strategies that differ from the opinions expressed within. Securities identified herein are subject to availability and changes in price. Additional information is available upon request. Who Invests in Floaters? Who Issues Floaters? How are Floaters Structured? However, floating rate funds carry a higher risk than their money market counterparts.

Money market funds invest in high-quality securities versus floating rate funds, which can invest in below investment grade securities such as loans.

Credit risk of floating rate funds can be a concern for investors who seek yield but are hesitant to take on the added risk to achieve that yield. Treasury yields are low, floating rate funds tend to appear more attractive than Treasuries. However, Treasuries offer safety since they're back to the U. Floating rate funds could have holdings that include corporate bonds that are close to junk status or loans that have default risk.

Although floating funds offer yields in a rising rate environment since they fluctuate with rising rates , investors must weigh the risks of investing in the funds and research the fund holdings. There are other short-term bond funds that primarily invest in Treasuries, but these funds might offer a fixed rate or a lower yield than floating rate funds. Investors need to weigh the risks and returns of each investment before making a decision. Mutual Funds. Actively scan device characteristics for identification.

Use precise geolocation data. Select personalised content. Create a personalised content profile. Measure ad performance. Select basic ads. Create a personalised ads profile. Select personalised ads. Apply market research to generate audience insights.

Measure content performance. Develop and improve products. List of Partners vendors. Your Money. Personal Finance. Your Practice. Foreign investing, especially in emerging markets, has additional risks, such as currency and market volatility and political and social instability.

A portfolio concentrated in one sector or that holds a limited number of securities may fluctuate more than a diversified portfolio. Fund distributions generally depend on income from underlying investments and may vary or cease altogether in the future.

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Treasury yields hit record lows with new cases of the coronavirus cropping up in Europe and the United States. Calls are growing for the Fed to act. We take a closer look at the risks in the bond markets. Sign up to get market insight and analysis delivered straight to your inbox. What is floating-rate debt? Weaker credits boosted by seniority and potential for active management. Neither accepted China's illegal occupation of our territory nor any unjustified Chinese claims: India.

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