# US Bonds



## Liz455 (7 December 2019)

Hello, I'm a longtime share investor and would like to move into US high yield bonds. I can't find any information on the mechanics of this. Does anyone know - am I able to purchase these through a broker from Australia?


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## Cam019 (7 December 2019)

Hi. What kind of bonds? I'm assuming you don't mean government, because you said high yield...


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## Liz455 (7 December 2019)

Cam019 said:


> Hi. What kind of bonds? I'm assuming you don't mean government, because you said high yield...




I'm interested in company bonds.


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## Brickie2 (7 December 2019)

Liz455 said:


> I'm interested in company bonds.



Google FIIG, you will have to fill out tax form


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## qldfrog (7 December 2019)

In another thread interested in US treasury bond, there is a mention of an asx traded edged etf


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## qldfrog (7 December 2019)

You are aware of the tax free status of us treasury bonds for us citizens and the low dividend as a rule for us share market ?
Good bond returns probably mean high risk


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## Liz455 (8 December 2019)

Brickie2 said:


> Google FIIG, you will have to fill out tax form



thank you for that info, useful.


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## Liz455 (8 December 2019)

qldfrog said:


> You are aware of the tax free status of us treasury bonds for us citizens and the low dividend as a rule for us share market ?
> Good bond returns probably mean high risk



I like the range available in the US,  but I think the risk can be lower than shares if you do your homework (company has to be able to pay interest on its loans and have suff capital to pay the bond, etc).  Still, might be too difficult from Aus.


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## qldfrog (8 December 2019)

Liz455 said:


> I like the range available in the US,  but I think the risk can be lower than shares if you do your homework (company has to be able to pay interest on its loans and have suff capital to pay the bond, etc).  Still, might be too difficult from Aus.



Have a look at BND vanguard etf. Or even BNDX
Thanks to @Sir Burr  for the info


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## Dona Ferentes (20 December 2019)

Jared Dillian at The 10th Man is also worth a read for regular homework. Get the freebie newsletter but don't sign up !

but remember, _High Yield _has another name: *JUNK.*


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## mullokintyre (31 May 2022)

I kinda think we don't need another pice of data to highlight the fact that the US is completely screwed, but I was a tad stunned when I read the following.
From Wall street on Parade


> On Tuesday, the New York Fed’s trading desk released its annual report showing what it was up to in 2021. The New York Fed is the only one of the Federal Reserve’s 12 regional Fed banks to have a trading desk operation with speed dials to Wall Street’s trading houses, so we’re always interested in reading the “official” version of what’s been happening there.
> 
> The report is a deeply sanitized version of the facts on the ground. (For example, there is nothing in the report to indicate that the New York Fed has established a second trading floor near the futures exchange in Chicago.)
> 
> ...




Not sure which is the most stunning, the 38% ownership of a  US$22.6 Trillion market segment, of the fact  that it owns 25% of  All types of maturities of the treasury debt. The fact that the fed owns so much of the 10-30 year means that its activity has had a dramatic affect on mortgage rates . By creating an artificial market for these treasuries, it has driven up the price and supressed the yields, which in turn suppress the mortgage interest  rates for US home buyers. So now with its cessation of QE, the price of the bonds have dropped and the yield gone up, which in turn drives up the mortgage  interest rates.




> Even more alarming, it means that the recent announcements by the Fed that it will be reducing its purchases of Treasury securities and shrinking its balance sheet by reducing the amount of principal payments that are rolled over into new Treasury securities, is going to have a dramatic impact on residential mortgage rates.
> 
> The chart below shows how the 30-year fixed rate mortgage has risen since the Fed made its first announcement of QE tapering on November 3, 2021 and subsequent tapering announcements. The 30-year fixed rate mortgage has spiked from an average of 3 percent to 5.25 percent as of May 19 of this year – an increase of 75 percent. The dramatic spike in the rate over a period of just seven months has priced many first-time home buyers out of the market.



Of course, those who already have fixed rate loans are not affected, but those yet to buy will be.
Mick


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