4.20.21 Valuations Matter in the Bond Market Too
“Price is what you pay; value is what you get.” – Legendary value investor Ben Graham.
Valuations matter—at least in the long run. We believe it to be true in the equity markets and in the fixed income markets as well. What you pay for an asset ultimately impacts your returns. So when looking at markets, we use, among other things, market-based metrics to help determine valuations. Within fixed income, while we don’t have the various price ratios, for example, to help guide the valuation conversation like equity investors do, we do have yield and spread measures. Two common metrics that we use in
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