Myron Shlapak

U.S. Long Bonds: Be Careful, We're in Injury Time

Granger,

I have some PFN. It is an Adjustable Rate Loan fund. As short term rates are currently going down, its monthly payment is being reduced and current holders are selling. This is causing PFN to sell at a discount to NAV, it is an PIMCO/Allianz ETF.

If you believe, as I do, that the future direction of interest rates are higher than these type of funds may be the way to go.

One caveate, as rates go up marginal borrowers will go belly-up at a higher rate.