In a Low-Yield World, Money Funds Lose Luster
Mike Martin, FAI’s Chief Investment Officer, is interviewed by the Wall Street Journal. Poor returns and looming rules spur interest in alternatives. Mr. Martin prefers to use short-term bond funds as a cash alternative over low-yielding money funds.
Mr. Martin says he has placed clients in the $5 billion FPA New Income Fund, which has generated a return of 2.2% in the past year and has an expense ratio of 0.57%, or $57 for every $10,000 invested. While the fund lagged behind its benchmark, the Barclays U.S. Aggregate Bond index, by about two percentage points in 2012, Mr. Martin is attracted to the fund’s short maturity and its credit quality, which Morningstar ranks highly.
To read the full article, please click here.
IMPORTANT DISCLOSURE INFORMATION
Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by FAI Wealth Management), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from FAI Wealth Management. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. FAI Wealth Management is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of FAI Wealth Management's current written disclosure statement discussing our advisory services and fees is available for review upon request.