Adam Lucks of WestPark Capital Shares View on Investors Looking for Yield

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LOS ANGELES--(BUSINESS WIRE)-- The following is a commentary by Adam Lucks, Head of Fixed Income Trading for WestPark Capital, Inc.:

Interest rates have fallen to all-time lows. Return on money market accounts and CDs are virtually non-existent. Keeping your money in cash can produce negative real returns due to inflation. So what do fixed income investors do? What trends are we seeing in the industry? Corporate bonds across the rating spectrum have experienced significant declines in the last few months. Investment grade bonds issued by Bank of America, ALLY Bank, and AIG have dropped by as much as 20 basis points in some cases. High yield bonds have dropped 30-50 points during the same time frame. Despite looming questions about the economy and prospects for growth, many of these companies have very strong balance sheets and appear to be solid credits.

As bond investors navigate a murky economic environment, there have been some portfolio concentrations in bonds issued by companies with strong cash balances. Many investors are looking to invest in the 5-10 year range, with a focus on the BB-BBB rated companies. They appear to be looking for bonds that are backed by inventory, receivables, or physical plant and equipment. With this mix, investors seem to be looking for returns in the 8-10% range.

We are closely watching to see how upcoming economic news around the world affects domestic stock and bond markets. Entering a presidential election year, we will continue to keep in tune with investor sentiment here and around the globe.

The views expressed herein are an opinion and do not constitute investment advice. WestPark Capital, Inc. did not conduct independent verification and therefore does not make any representations as to the accuracy of the assertions made.

About WestPark Capital

In November 2010, WestPark Capital was recognized by the Los Angeles Business Journal as one of the “Top 100 Fastest Growing Private Companies,” in Los Angeles. The company ranked 16 on the list and was only one of two financial services companies to earn a position in the highly regarded annual survey. WestPark Capital, Inc., (www.wpcapital.com) specializes in taking companies public. It is a full-service national and international investment bank focused on emerging growth sectors such as healthcare, software, technology, biotechnology, financial services, manufacturing, consumer products, and media and telecom industries, among other categories. Member: FINRA/SIPC.