Low‑Volatility Carry Engine

Bob Elliott posted on Bluesky that "rate rises have been the most common prick that pops bubbles throughout history." There is certainly visibility for the FOMC to start hiking after that last bit of inflation data and based on what Fed Fund Futures are now pricing in for 2027. Who knows what will actually happen but there is a path to hikes.

To the second half of Bob's quote, is there now a bubble? Maybe, but that is more difficult to determine versus observing there are excesses and a few warning signs. The sector weightings of the S&P 500 is something we've been talking about lately and the current tech weighting or tech + communications which I think might be a better way to look at it is certainly excessive. The capex numbers being thrown around and the debt being issued to fund that capex also seems excessive. 

Maybe these signs of excess won't matter, maybe there will be no consequence but portfolios and retirement outcomes are not threatened by what can go right which is why it is so important to look for signs of obvious excess and make decisions about whether to address the threat. 

It's not practical to avoid 47% (tech + communications) of the S&P 500 in a portfolio that needs some equity market growth. I do think being underweight is feasible, I've been in the 20's in terms of percent with most of the exposure coming from a sector ETF, an individual stock and EMXC has evolved into having a lot of semiconductor beta.

Completely avoiding bond duration is much easier because the positive attributes have been pretty easy to replace. Replacing the positive attributes of tech stocks would be more difficult.

SPXT is the S&P 500 excluding the tech sector. So it includes some tech adjacent names like Amazon, Google, Netflix, Meta and Tesla but still compounds quite a bit lower than the full S&P 500. Maybe you could overcome the 400 basis points but I think that path is more difficult than simply underweighting. 

Against this backdrop, Owen Lamont had some interesting things to say about global equity diversification. The short version is that globalization of trade has made global equity diversification less effective but now because the trend toward globalization is reversing it should make global equity diversification more important. 

I'm not sure I agree with the premise that the value of global diversification has been diluted by globalization. That implies that correlations have gone up and that returns have been less differentiated which hasn't been the case assuming he is going back further than the start of this year.

But, foreign equity exposure is still very important and if any of the chatter about the Thucydides Trap has made your radar, anyone not having any foreign exposure should probably do some work there. I don't take Thucydides literally, at least I hope that is not the outcome, but it seems like the current administration's policies are designed to make us less globally relevant. That would be a big negative, creating visibility for another decade like the 2000's where select foreign outperformed domestic. Broad foreign outperformed by a little but some select pockets outperformed by a lot.

The threatened drags from there being a consequence to the excess in tech, globalization happening without the US and let's throw in visibility for higher interest rates raises the question about how to make portfolios a little more robust or all-weatherish. 

Like we've been talking about, the way that products have developed, there isn't a need to completely turn a portfolio inside out against these risks because they might never matter. Adding a little managed futures for anyone who doesn't have that exposure is probably a good idea. The negative themes we've isolated today are probably slower moving as opposed to the Tariff Crash which is more conducive for managed futures to do well. Long time readers know I am a believer in adding negative convexity like with BTAL. That's certainly not for everyone but adding negative convexity is an effective way to make portfolios defensive without selling anything or selling very little. 

And a fun item to close out. Obviously we spend a lot of time on what to do with the 40% that typically goes into bonds in a 60/40 portfolio. I was doing a little work on the concept with Copilot and it came up with two different descriptions for my approach of no duration, instead using alts as bond substitutes and keeping duration very short in more traditional income sectors. Copilot called the strategy a low‑volatility carry engine and a risk‑controlled carry portfolio.

Carry means several different things but in this context it refers to the yield earned. 

SHRIX invests in catastrophe bonds and I'd say is an extreme example of low volatility carry and YieldMax Netflix (NFLY) is a pretty extreme example of high volatility carry. I threw T-bills in just for a little context. The SHRIX lines (I use a different cat bond fund IRL) are what I am trying to get out of the 40, or whatever percentage, that would usually go into bonds. 

The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.

Explaining Your Strategy To A Child

Michael Sonnenfeldt from Tiger 21 wrote a guest essay for Barron's about whether or not to establish a family office. The main point about needing a family office probably isn't germane to what we do here but he had some pretty good one liners that are worth sharing. 

1) Intelligent discipline beats brilliance. Process is repeatable. Genius isn’t.

We talk all the time about process. I would add the idea of simplicity to this point. I think anyone's investment process should be simple relative to their own experience and capacity. I don't think Cliff Asness thinks what AQR does is simple but none of us are Cliff Asness. I first learned about the idea of simplicity in this context from Peter Lynch in the 1980's. Paraphrasing, you should be able to explain your process to a child. 

2) Position sizing is the sharpest risk tool. 

Yes. This point is an essential building block for understanding how to manage risk. I'll reference a reader comment from 2006 who put 25% of his portfolio into Pozen, betting on a migraine treatment. There was bad FDA news and the stock fell by 61%. He put 1/4 of his money into a lottery ticket. It's hard to be critical of making the bet but the sizing was catastrophically bad. 

3) If you can’t explain your edge, index proudly. 

I don't take this literally. Indexing is of course valid but so too are plenty of other simple strategies. Ideally, a portfolio only needs to be tweaked occasionally versus a lot of churn. This is why so much of the content on CNBC as well as a lot of stock market websites should be avoided. They try to get you to trade more which is the wrong thing for so many people. I would rephrase number 3 to build a portfolio you can live (sleep) with that doesn't require constant trading. 

If I have an edge, I don't love that word, I think it is avoiding or being seriously underweight areas where the risk of something terrible happening is high. Hopefully that is repeatable in the future but I have had this luck in the past.

And because I think there is a connection, the CEO of the Harvard Management Company, the endowment, announced he is retiring. The link includes a little bit about the performance which has run at close to 8%. The comments, it's a WSJ article, piled on about how far behind the S&P 500 the endowment has been. 

The endowment doesn't benchmark to the S&P 500. Apparently, the HMC targets an 8% return to account for inflation and the amount of the school's budget it covers. It's fair game to wonder whether that is the appropriate target or not but that's what it is. 

One point we've made here before is that there are things to learn from how endowments allocate but I don't think they should be emulated. One reason is that we do not have access to the private equity and venture managers that Harvard does. The other is that we are not managing for an infinite time horizon the way a college endowment should be doing. 

The idea of targeting 8% or some other number is difficult to pull off but I think the idea drifts into making sure you have the correct allocation to stocks, making sure you don't have more than you need. For example, a 55 year old who wants to retire at 68, has $1.8 million now, thinks his number is $2.5 million and is still adding to his savings. 

The median total return for rolling 13 year periods going back 100 years is 10.7% annualized, 274% total. This guy could have just 35% or $630,000 in equities and most likely come out ahead of what he thinks his number should be. Remember he is also still putting money in every year. I could see where 35% might be uncomfortably low but I don't think this situation needs 60% in equities either. 

The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.

Are You Ready If Rates Go Up?

Jonathan Hoenig Tweeted this out

Yields have been trending higher of course which historically has spelled trouble for stocks. Someone else on Bloomberg this morning (didn't catch who it was) said that 4.5% is not great, 5% would be trouble and pegged 4.80% as being where trouble starts. Maybe but I would take it as there potentially being some sort of adjustment period for stocks. There's no way to know how long any sort of adjustment period would last or how much stocks might drop if at all.

Any of this playing out means bond prices go down and we might be able to take today (Friday) as a microcosm for what this "adjustment period" might look like for plain vanilla 60/40.

AOR is an ETF proxy for plain vanilla 60/40.

Repeating for the 1000th time, just avoid duration. The four blanked out funds above are all huge ETFs, not obscure, that we write about all the time. They avoid duration risk and don't feel the pain of things like TLT when rates rise. 

Cullen Roche gave a quick post mortem on the collapse of the QVR Hedge Fund which focused on volatility. This specific point is relevant to today's conversation.

1) Tail risk hedging is really, really hard. There’s a reason the classic 60/40 stock/bond portfolio remains the most popular allocation in the world: the 40% in bonds is still the simplest, most reliable positively asymmetric long-term hedge most investors can implement. It’s not perfect, but it’s “good enough” for the vast majority of people who just want durable diversification without needing to be geniuses.

Cullen is far more comfortable with bonds with duration than I am. Something like 60/40 can be all the things Cullen says but my argument is that there is a better chance of being all those things by avoiding duration in the 40. And as noted above, there are many ways to replace the duration with less volatility, a little more yield and still diversifying the risks versus putting 40% in UTEN, TLT or the like. I would also add short term individual issues into the mix if you're comfortable. 

Unrelated, here's a doozy of an ETF filing.

The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.

Beware Of Morningstar Mischaracterizations

A couple of quick things tonight. 

First is a model ETF portfolio that I was able to get a look at. I won't get into specific funds and weightings but the basic idea was a lot of factor funds and very ordinary fixed income exposure including the Fidelity version of the AGG and some others that will look pretty similar to AGG.

There's not a lot of differentiation except in 2022 when the model was down about 300 basis points less than VBAIX and this year it is about 500 basis points ahead. 

Back to the factors, the model has 17 holdings, eight of which are different factor funds. To the extent a market cap weighted fund takes in all the factors, when you add too many different factors together they sort of wash out and drift toward looking a lot like market cap weighting which presumably they are trying to avoid. For anyone wanting to go down the factor road, I think it can be done more effectively with far fewer funds. Eight different ones seems like being too clever by half.

And second, a new fund alert; the Absolute Flexible Fund (FLXIX). It is convertible arbitrage-ish in that it won't always hedge every position. It says it should have about half the "beta" of high yield. It has been around for almost four years, has very little in assets and is nominally expensive. It isn't a yield play, paying out 2,88% but a portion of that is capital gains. 

The comparison is to AGG, high yield with HYG and then a couple of convertible bond funds. Just eyeballing it, I'm not sure how AGG is less volatile but FLXIX exceeds the volatility expectation versus HYG.

The fund only gets two stars from Morningstar because it is in the convertible bond category but it is not a long only fund like the majority of the category. Morningstar has miscategorized the fund. The typical convertible bond fund has a lot of equity beta and whether FLXIX is a good fund or a crappy fund, it has pretty much no equity beta. 

The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.

Tell Your Friends

The NY Times had an article about retirees that have had to go back to work because their retirement math wasn't working out for them. A few of the people profiled simply did not have an adequate understanding of how the dollars and cents of retiring work. It might have been a lack of planning, not sure, but they simply did not understand. 

Most of the stories started before AI was commonly used. Now that AI is ubiquitous, anyone can use it to build a very basic framework. I'm not saying it will get everything right at this point and maybe there are some biases to sift through but in terms of an elementary starting  point where before there was less help available, AI can be helpful. 

Using Copilot, I told it I was going to make up a scenario, then ask some questions and I asked to keep the answers short. Here's the conversation with Copilot.

Roger: I am a 57 year old male. My wife is 55. We both want to retire when I am 65. My wife is in good health and I take a statin and blood pressure medication. We have a combined $300,000 in our 401ks and $26,000 in an emergency fund. I make $68,000 and my wife makes $51,000. We spend $6500/mo but that includes a mortgage that will be paid off when I am 67. First question is how much more do we need to save to be able to afford retirement?

Copilot: About $1.1M–$1.3M total by age 65 (including your current $300k).

Very rough rule‑of‑thumb math:

Spending drops to ~$5,000/mo once mortgage ends.
With Social Security, you’d want ~$1.1M–$1.3M to retire comfortably at 65.

You’re about $800k–$1M short, which means saving roughly $35k–$45k/yr combined (including employer matches + growth) gets you close.

Roger: What would you estimate our combined social security benefits to be if we both take it when I turn 65?

Copilot: Very rough estimate: ~$48k–$52k/yr combined if you both claim when you are 65.

Breakdown:

You at 65: ~$32k–$35k/yr
Wife at 63: ~$16k–$17k/yr

Total: about $4,000–$4,300/month.

Roger: If social security will be $4000/mo and we spend $5000 after the mortgage is paid off, why do we need $1 million dollars saved?

Copilot: Because the $1,000 gap isn’t the real gap — the real gap is inflation + longevity + market risk.

Super short version:

Your $5,000/mo at 65 becomes $7,000/mo at 75 and $9,000/mo at 85 with normal inflation.
Social Security doesn’t fully keep up with your rising spending.
You need savings to cover the growing gap for 25–30 years, not just the first year.

So the $1M isn’t to cover the first $1,000/mo — it’s to cover decades of rising costs and protect you if markets underperform or you live into your 90s.

Roger: Is the $35,000-$45,000 you think we need to save for both of us combined?

Copilot: Yes — that’s combined, not each.

Very short version:

You need to grow from $300k → ~$1.1M–$1.3M by age 65.
That requires roughly $35k–$45k/yr total household saving + growth.

 Roger: At most, we can only save $25,000/yr where will that leave us when I am 65?

Copilot: Very short answer: about $650k–$750k total by age 65.

Here’s the quick math:

You save $25k/yr for 8 years → $200k contributions
Assuming ~6% growth → your current $300k grows to ~$480k
Your new contributions grow to ~$170k
Total at 65 ≈ $650k (low return) to $750k (normal return)

So you’d end up about half of the ideal $1.1M–$1.3M target. 

Roger: What should we do if we are that far short of what we need?

Copilot: Here’s the short, blunt version:

If you retire at 65 with $650k–$750k, you’re not doomed — but you can’t run the same plan as someone with $1.2M. You’d need to adjust one or more of these levers:

1) Work longer (even part‑time).

Working to 67–68 shrinks the gap dramatically: more savings, fewer years to fund, higher Social Security.

2) Spend less.

If you can get spending to $4,000–$4,500/mo after the mortgage ends, the plan becomes workable.

3) Use home equity later.

Downsizing or a reverse mortgage in your 70s can fill the late‑life gap.

4) Delay Social Security.

Waiting to 67–70 boosts benefits 14–24%+, reducing how much savings you need.

5) Keep investing aggressively enough.

A too‑conservative portfolio makes the shortfall worse.

In practice, most households in your situation combine #1 + #2, and that’s usually enough to make the math work safely.

Roger: What other questions should I ask?

Copilot: Here are the short, high‑impact questions that make a retirement plan go from fuzzy to clear — perfect for your blog post’s point that AI can walk people through a framework.

1) What will our spending really be after the mortgage ends?

Most people never separate “today’s spending” from “retirement spending.”

2) How much of that spending will Social Security cover?

This tells you the size of the income gap.

3) How much will our savings grow by retirement?

People underestimate compounding and overestimate returns.

4) How long do we need the money to last?

Longevity is the silent risk.

5) What happens if returns are below average?

A simple “bad decade” scenario changes everything.

6) What levers can we pull — work longer, spend less, delay SS, downsize?

Retirement math is flexible once you see the levers.

7) What’s our safe withdrawal rate given our situation?

Not everyone gets 4%; some get 3.5%, some get 5%.

8) Are we invested appropriately for growth before and after retirement?

Too conservative = running out of money; too aggressive = volatility panic.

9) What’s our plan for healthcare before Medicare?

This is the #1 surprise cost.

10) What’s our plan for late‑life expenses (long‑term care, home repairs, etc.)?

This is where many retirements break.

Ok so that was the entire exchange. If you're reading a blog as obscure as this one, then you may know most or all of what Copilot said but you know people who don't. This can be solvable for people who realize they need to put some effort in to figuring this out but maybe they need some encouragement (from us) to get started. 

The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.

It's Time To Start Solving The Problem

Today's post is about Social Security and retirement planning with the catalyst being a bunch of content this weekend that hopefully I can weave into a useful commentary. By planning I mean both financially but also lifestyle-wise too. 

We'll start with an opinion piece in Barron's that argued for capping Social Security benefits at $100,000 per household or $50,000 for singles. Couples where both partners make the maximum salary (for purposes of payout calculations) will bring in $100,000+ from Social Security. Any sort of negative reaction you might have to a cap is fair but it is pretty clear that capping benefits is going to be part of the conversation. If nothing changes then every will get a 23% haircut starting in around 2033 or 2034. If they only take away from people perceived as being wealthy then that is probably more palatable to politicians in terms of votes. Tax/penalize the rich is often a popular argument. 

The opinion piece didn't say this but they would obviously need to index any sort of cap for inflation. Oddly, the essay didn't quantify how much the cap would help address the problem so I went to Copilot A $100,000 cap would save $100-$190 billion over ten years out of about $300-$350 billion problem, again per Copilot. The way the full answer was worded, my follow up was would it be fair to conclude that just implementing a $100,000 cap would mean that instead of cutting everyone else by 23%, that the cut to everyone else would be just 20%. That would be a slight improvement and Copilot said yes, that would be plausible. 

The comments seemed very hostile to capping the payout but more open to eliminating the cap on payroll taxes going in. So they were against getting less coming out but ok with paying more going in which surprises me. Eliminating the payroll tax cap would solve about half the problem. Stacking the capped benefits and eliminating the cap on payroll tax would plausibly mean that everyone else's benefit is only cut by 10%. Copilot called that defensible. 

One reader had an interesting idea about not taxing RMDs. I'll tweak that to increasing the exemption on IRA distributions like maybe the first $50,000 (indexed for inflation) is exempt from taxes. Some sort of actuarial analysis could come up with a workable number. 

If Congress tries to fix the problem then some people will be upset and believe they are being treated unfairly. If Congress does nothing then everyone will be upset and believe they are being treated unfairly. Any attempt to solve the problem is going to involve very difficult decisions. I don't know what I think is best, my comments above pick up on the idea from the essay and again, like it or not, some sort of cap is going to be part of the discussion. I continue to believe it makes sense to account for a reduced payout in your planning. 

The Washington Post had a very downbeat article about men leaving the workforce. 

Older men are being forced out for reasons we've talked about before and "young men who are disabled or in school" aren't entering the labor force. The implication for the young men is they can't seem to get started, many of them are living at home and feel no motivation to start their lives. These are statistics so maybe there is a grain of salt to be taken here but there were a handful of anecdotes that tried to give a broad perspective on the issue. 

I don't have great insight into why younger people are having trouble getting started but over the years I have noticed when friends closer to my age on Facebook have had their hands forced at work. Some chose to retire while others maybe aren't working but don't think of themselves as retired. On the positive side, I have noticed more friends retire because they wanted to and presumably were financially able to do so. 

If younger men are not entering the workforce then that would seem to be shorter term negative for Social Security as current workers pay for current retirees but it could be long term positive for the program because they will get smaller benefits when they hit retirement age. By positive, I mean for the viability of the program not for society overall. 

Whether the problem is as serious as the WaPo portrays it or not, we know it is happening to some extent and again, I continue to believe it makes sense to account for being forced out of your primary career sooner than you hope for. 

Barron's had an article with a three item check list for anyone retiring early, regardless of whether they want to or have to. The first item was healthcare costs. As we've looked at before, a couple earning $84,000 or less can still get insurance from healthcare.gov for essentially free which is a viable option for bridging to Medicare. It looks like if in this bridge period you take any qualified distributions from a Roth IRA, that does not count toward MAGI in determining eligibility for subsidies but taking from a traditional IRA account would count toward MAGI. Spending cash out of a taxable account would not add to MAGI either but long term capital gains would. Do some real research on that if it applies to your situation. 

To the extent people retire early for health reasons, it won't be so simple as lift weights/cut carbs and solve all your problems. However, I do believe that many health problems can be improved with the right type of physical therapy/training but it would take some effort to figure out how and then to stick with it. And of course a better diet will not make it worse. The other two items in this article were portfolio readiness and having a sense of purpose which are both points we talk about here all the time.

The final Barron's article was about choosing where to live in retirement including whether or not to downsize. Downsizing has two components, downsizing square footage but also downsizing financially. It seems like it has gotten a little harder to downsize financially in the last few years but that is just an anecdotal observation. For someone wanting to downsize, going from 3000 square feet to 1500 and being able to take out a couple hundred thousand in the transaction is a no brainer. 

If someone wants to downsize from 3000 to 1500 but needs to upsize financially, that becomes a more difficult decision. Someone who is somewhat behind where they need to be in terms of accumulated assets can't make that trade. They'd need to find somewhere else to downsize into. 

The New York Times looked at several retired couples who downsized into some version of van life with some people literally making a go of it in vans and others in Class A motor homes. The people profiled seem to have some financial challenges without being desperate. At least one of them seemed to be in very good financial shape but who knows. A negative point about the article is that it seemed like all of them had big enough social media followings (Insta or TikTok) that they made incomes from posting about van life. It's negative from the standpoint of not everyone will find that kind of audience. 

My wife and I have a bit about driving around the country solving mysteries but if some version of van life so appeals to you that you want to actually do it, rent something and go out for just a few months to make sure you actually like it before plunking down a bunch of money.

It certainly seems like being able to retire has gotten and continues to get more difficult. I saw firsthand when we first moved to Walker, it was not very affluent twenty whatever years ago, that people figured it out because they had to. Not everyone will figure it out but I have also learned in the last few years with my work at the Del E Webb Foundation that there are countless, non governmental resources to help with food, places to live and healthcare. And while those sorts of resources may not come into play for the typical blog reader, it is important to realize they exist. 

Hopefully everyone reading this has a comfortable retirement sorted out for themselves but being even a little bit clued in how to help someone else figure it out because they have to will be important because I am skeptical that the government will help.

The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.

Is This New Covered Call Fund The Answer?

A recurring theme here is the extent to which new products will evolve to improve the result that investors get. I think we're seeing that in real time from Global X and its covered call funds. First there was QYLD which sells monthly covered calls and while the distributions are high there has been no price-only growth since the fund's inception. Then came XYLG which sells monthly calls on half the portfolio and since its inception, it has yielded about 11% and had price only compounding at 2.43%.

A couple of months ago, Global X came out with EDGX which sells weekly covered calls targeting a 9% annual distribution which should allow for better upcapture which they believe their clients want. The chart encapsulates the "improvement" even if it is too soon to draw any conclusions about EDGX.

XYLD is the oldest fund in this product line from Global X and since its inception the S&P 500 has compounded at 14%. A 9% yield from EDGX with 5% of price appreciation left over would be a great outcome. Global X believes it can be more tactical with EDGX to get more upside than the more methodical methods for XYLD and XYLG. Once you accept that these are not going to capture the S&P 500 on the way up, you can start to assess whether there is any utility.

There is more yield than something like TLT but with less volatility than TLT. If you want to compare to high yield bonds instead of long dated treasuries, a fund like HYG is less volatile than the covered call funds. 

Getting 5% after a large yield is paid out would be compelling however building some sort of model or whatever that relies on 14% from the S&P 500 might not pan out going forward. That's a very high number and while we can hope that persists, putting some large weighting into EDGX expecting a 9% payout plus 5% in price only growth might turn out to be realistic. We've talked about small slices to completely different types of high yielding niches such that 15-20% of a portfolio split between three or four disparate strategies, disparate risks, can work. The Global X funds don't yield 50%, they might end up being lousy holds but they aren't going to go to zero. 

In a similar vein, I've been following BTYB which allocates 80% to five year treasuries and 20% to a synthetic Bitcoin covered call. The outcome sought is a yield that is twice the yield of the five year treasury. I tried to model it using YBTC which I believe is the first Bitcoin covered call ETF. When I do that, it only takes 10% in YBTC to get an 8% yield as follows.

This backtest goes back to January 2024 so we can see how the combo did as Bitcoin dropped a lot last fall.

Is a drop of just over 7% (price only) too much? It's still down that much for anyone taking the distributions out of their account. Is it too much? That is a question that anyone actually considering this fund needs to consider. However, my backtest only has 10% in Bitcoin, BTYB has 20%. Putting 10% into YBTC got us 2x the yield of UFIV but if we tweak it to 80% UFIV/20% YBTC, the blend fell by 15% on a price only basis and has not recovered yet.

The drop in Bitcoin was pretty big but far from an outlier. 

I am obviously intrigued by selling volatility but it is not something I do a lot of, it is tricky and you have to look hard to find a compelling risk return tradeoff. 

A small slice for someone looking to add yield but able to overlook line item risk can work but keep it small, repeated for emphasis. 

The information, analysis and opinions expressed herein reflect our judgment and opinions as of the date of writing and are subject to change at any time without notice. They are not intended to constitute legal, tax, securities or investment advice or a recommended course of action in any given situation.