It has been more than 10 years since we have had an interest rate rise in the UK with the ultra-low rates putting pressure on yields right across the board. The average notice account now pays 0.9% − considerably less than inflation – compared to 5% in July 2007 and the investment grade corporate bond yield has fallen from 6.4% to 2.8%.
These unprecedented market conditions have made it difficult for investors to earn a decent income without taking on excessive risk, but it is possible to build an equal weighted portfolio of three uncorrelated investment trusts that yields more than 6% with almost identical monthly payments.
by Evil Knievil| Evil Diaries| 1 mins. to read Borrowing stock is nowadays much more expensive than ever it used to be. This is because the banks have given up on trusting one another. There is the further problem that the spread firms decide to nick a further c. 3% p.a.
by Victor Hill| Economics| 15 mins. to read The minority UK Conservative government is under pressure to loosen the fiscal purse strings. Does that mean the dream of balancing the budget remains no more than a dream? Who would benefit? Will taxes have to rise? And what are the risks?
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