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By indicating that short-term rates will stay low until the end of 2014, the Fed is also having an effect on medium-term bond yields.All this means that the risk-reward ratio for holding government bonds looks pretty skewed.
In that case, there will be much talk of the Japan syndrome, and it is conceivable that medium-term bond yields will drop into the 1-2% range.This might seem incredible in light of the sovereign-debt crisis which loomed so large in 2010.
This time we have 15 separate listings for sector funds, for example, and we distinguish diversified medium-term bond funds from government-only medium-term bond funds.
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In Europe, the central issue is the rollover of medium-term bonds.
In Paris, the national debt management agency sold €7.965 billion of medium-term bonds at the top of a target range of €6.5 billion to €8 billion.
See articleLet's twist againIn this section Politics this week Business this week KAL's cartoon ReprintsThe Federal Reserve extended until January its programme of buying longer-term bonds in exchange for short- or medium-term bonds already in its portfolio.
He also exited long- and medium-term bonds for fear that rising rates would zap them.
For links to rankings of ETFs on short-term holding periods in other categories (medium-term bonds, foreign stocks, etc)., go to Best ETFs for Trading.
Brokers love laddering for two reasons, he says: It gives them a lot of work scaring up medium-term bonds every two years; and it protects them against angry phone calls.
In France's first auction since Mr. Hollande became president, the Treasury sold about €8 billion of medium term bonds, including €3.7 billion of debt maturing in 2017 priced to yield 1.72 percent, the lowest ever.
If you own long-term bonds in your portfolio, you might want to get more exposure to short to medium term bonds.
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