Never Dive for Yield

In this low-rate environment, everyone is in the hunt for yield.
When looking for yield, take the time to ask the key questions.
It is important to remember that excess yields often have excess risks.

The interest rates we’ve experienced during our lives have declined, and the yield on bank deposits and certificates of deposit has fallen to almost zero. As investment income becomes scarcer, we face the temptation to reach or, more precisely, dive for yield. This is a quest with deep risks.

Should the Markets be Worried?

Put economic progress in Europe together with low interest rates and energy costs, and we have a recipe for a continued world business cycle with some more propulsion than we had a year ago, says Jim Swanson, MFS Chief Investment Strategist.

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Jobs, Jobs, Jobs

US payrolls have been expanding consistently.
The mix of jobs and wages has been improving.
Even the “worry zones” are seeing employment growth.

Of course investors ought to avoid complacency, but facts — not rumor and speculation — are their best guard against investment mistakes. Despite the worries we see around the world, one of the most critical considerations for investors is the health of the business cycle. And the most important feature of any business cycle is the employment situation.