It's Getting Harder To Lose Money In Income

Nov. 10, 2022 4:25 AM ETFFC, FINS, NLY, NLY.PF, NLY.PG, NLY.PI, PTA15 Comments

Summary

  • Most income sectors are sitting on sizable losses this year as a result of higher interest rates, wider credit spreads and lower equity prices.
  • Given these results, it can be easy to sell into weakness and lose sight of the fact that this year's rise in yields has generated a large margin of safety.
  • We take a look at a number of income sectors and highlight the key dynamics that provide a sizable cushion for investors.
  • The key takeaway is not that asset prices are going to zoom up, but that the pace of losses seen in 2022 is very difficult to sustain for the market.
  • This offers an attractive entry point for new capital across a number of different income sectors.
  • Looking for a helping hand in the market? Members of Systematic Income get exclusive ideas and guidance to navigate any climate. Learn More »

Business And Finance Concept Of A Bull Market Trend High Quality

Darren415

This article was first released to Systematic Income subscribers and free trials on Nov. 1.

As investors are well aware, most income sectors are sitting on sizable losses this year as a result of higher interest rates, wider credit spreads

FRED

FRED

S&P: High Yield Default Rate to Hit 5.6% by June 2017 | S&P Global Market Intelligence

S&P

DX

DX

TCW

TCW

Marketwatch

Marketwatch

Flaherty & Crumrine

Flaherty & Crumrine

Systematic Income

Systematic Income

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This article was written by

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Income investing across BDCs, CEFs, ETFs, preferreds, baby bonds and more.

At Systematic Income our aim is to build robust Income Portfolios with mid-to-high single digit yields and provide investors with unique Interactive Tools to cut through the wealth of different investment options across BDCs, CEFs, ETFs, mutual funds, preferred stocks and more. Join us on our Marketplace service Systematic Income.

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Disclosure: I/we have a beneficial long position in the shares of NLY.PG, FINS, PTA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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