By Samuel Shen and Noah Sin SHANGHAI/HONG KONG(Reuters) - When the Shanghai-traded bonds of conglomerate China Minsheng Investment Group plunged 40 percent over two days in January after news it had missed a repayment, Beijing-based hedge fund manager Jash Zhang smelled blood. As the private investors in the bond rushed to sell, Zhang snapped up CMIG's dumped bonds at about 50 yuan apiece, or half their face value, betting that the 300-billion-yuan company would eventually repay the debt. The strategy，she said, is simply to pounce when faint-hearted investors are wavering. "When bad news breaks about an issuer, some funds will scramble to sell the bonds," said Liu Xiaofang, head of investment research at Shanghai Fengshi Asset Management Ltd, which launched its first vulture fund in September. But the bonds' underlying problem might be "not that big," creating opportunities. Zhang and Liu are among a new flock of vulture investors that have emerged in China's corporate bond … [Read more...] about China’s fledgling junk bond market spawns new breed of vulture funds
Mutual funds 10 percent return
Stan Choe Associated Press Published 4:12 PM EST Jan 22, 2019 New York – Forty years ago, the thought of buying a stock index fund was ridiculed. Why would anyone be satisfied with an investment that promised nothing more than the same return as the market? Later this year, however, U.S. stock index funds may for the first time control more in assets than mutual funds run by stock-picking managers trying to deliver better returns than an index like the S&P 500. The surge in popularity for index funds is a product of their lower fees, better performance and the preaching of John Bogle, the founder of Vanguard Group, which launched the first index mutual fund for individual investors in 1976. Bogle died Jan. 16 at 89 after pushing for years to keep costs down and widen access to index funds. Initially derided as “Bogle’s folly,” index funds have become the default way to invest for so many people that some critics now worry about unintended, … [Read more...] about 40 years after his ‘folly,’ Bogle’s index funds reign
Stan Choe, Ap Business Writer Updated 8:27 am PDT, Thursday, September 27, 2018 FILE- In this Sept. 21, 2018, file photo customers wait in line outside of the Apple Store at the Garden State Plaza on the day the new iPhone XS and iPhone XS Max were released in Paramus, N.J. FILE- In this Sept. 21, 2018, file photo customers wait in line outside of the Apple Store at the Garden State Plaza on the day the new iPhone XS and iPhone XS Max were released in Paramus, N.J. Photo: Julio Cortez, AP FILE- In this Aug. 2, 2018, file photo an electronic screen displays Apple stock at the Nasdaq MarketSite in New York. Funds that focus on U.S. stocks charged to record heights, bolstered by Apple and other companies reporting tax-cut-fueled profit gains that were even more eye-popping than analysts expected. The U.S. economy also hit its fastest growth rate in nearly four years, and S&P 500 index funds are on track … [Read more...] about 3Q Fund Review: A hot, America First summer for investments
In the investing world, there's no such thing as a free lunch. But that all changed last week, when Fidelity Investments, the mutual fund and brokerage giant, launched two stock index funds with zero expenses. To be clear, this is a unique thing in the financial industry. It costs a firm money to operate a fund, which includes costs for things like office space, employee salaries, trading, regulatory filings and legal expenses. Fidelity is the first major fund manager willing to absorb these costs for two of its index funds. The new zero-cost funds mean that investors in these funds will experience the same returns as provided by the broad range of stocks that make up the index, without any loss of returns because of fees. The two new funds are the Fidelity Zero Total Market Index Fund (FZROX) and the Fidelity Zero Internal Index Fund (FZILX.) The total market index fund seeks to provide the investment returns of the broad market of U.S. stocks. The International index fund … [Read more...] about Fidelity offers new zero-cost mutual funds – should you switch?
Over the past eight years, anyone with some extra cash to invest has had a problem: Finding a safe place to put it that earned a reasonable rate of interest was nearly impossible. But since 2015, the Federal Reserve has hiked interest rates seven times, with each increase being 25 basis points. Suddenly, earning a real rate of interest -- that is, an interest rate at least equal to inflation -- is a viable option. That is, if you know where to look. Here are three good investments for anyone looking to earn more interest on their savings, and two to avoid. Money market funds These can either be FDIC-insured bank products or mutual funds that come without any government guaranty of safety for your principal. Seven-day yields for taxable MMFs now range from 1.8 percent to about 2 percent. To get the highest yields, you'll have to begin with a minimum initial deposit of $5,000 to $10,000. Among institutional-class MMFs are the Fidelity Investments Money Market Class I, which has … [Read more...] about Where savers can finally earn a decent return