Rabu, 13 April 2011

Looking for Safe Investments Crisis

Well, what should investors do? Borrowing a phrase from the Watergate, follow the money, find out who holds the cash, then go there. These tips for many investors can mean a high-ranked corporate bonds and stocks in solid companies.

For other investors, invest funds in emerging markets with large yields or interest rates higher. That's for the short term. For the longer term, investors still love the stocks that exceed its performance bond.

Many investors are also seeking to merge with the storm by investing in corporate bonds and shares good if it has good cash flow. "Assets in the private sector will perform better than the assets in the public sector. Balance of the company is much more clearly than the balance of the state," said Klaus Wiener, head of Research Generali Investments in Cologne.

Many investors stormed corporate bonds with good ratings, which give higher ratings than the bonds in their country. This number will likely increase if the United States ranks actually lowered. It reflects the government's debt crisis in the U.S. and Europe have changed the risk category in the minds of investors.

Many high-yield bonds from developing countries is now viewed as a more promising investment than bonds in the eurozone. In fact, some of the stocks considered safer than government bonds.

Wiener said the company related to the energy sector and insurance sector has seen a steady cash flow. Thomson Reuters StarMine gobal insurance data show the ratio of long-term debt, with equity ratio of 0.41. That figure is higher than the ratio in the financial sector which amounted to 1.52.

Sanjay Joshi, Portfolio Manager of the London & Capital Wealth Management states, like investment instruments such as corporate bonds with a good level of investment as a short-term safety. He gave an example of Johnson and Johnson, Wal-Mart, and Tesco.

The flow of funds into emerging market that is often underestimated as an investment has become a haven to seek security even if sometimes volatile, too. Fiscal security in developing countries are already much improved today and has produced its fruit.

Two instruments safe, high-quality government bonds and cash, nor can finally fulfill the desire of investors to protect them from the global economic downturn and the various crises. Low interest rates of government bonds from developed countries, combined with a few cases with quantitative easing program by printing money, making the yield if winning the cash is not reliable.

Securities tenured six months or less denominated in U.S. dollars, pounds and yen only yield less than 1 percent. Euro even lower. As for bonds, rising inflation and demand for safe investment instruments during the various crises make government bonds yield a negative net yield. That is, the purchase of bonds currently unable to cover the rising cost of living.


For example, German bonds which is the hottest European bonds yielding 2.4 percent, equal to the rate of inflation, thus yielding real zero. This is the first time this has happened since at least 1957. U.S. bond yields and the UK have even negative. Only Japan that offer positive returns for the Japanese inflation rate is negligible.


Nevertheless, investors are still looking for government bonds. A little lost still acceptable, at least for now.
Gold is currently also the target of investors. Similarly, the Swiss franc reached a record against the dollar and euro. Both assets were used as a safety increasingly popular in times of crisis.

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