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Fidelity High Income Message Board

  • snoit123 snoit123 Dec 3, 2007 6:20 PM Flag

    LOOKS LIKE A BUY HERE?............

    It has traded in a range for past 4 years and is now near the bottom of the range.

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    • Don't bother with yearly or 'to maturity' rates, just watch the 30 day yield.

      That is the best indicator of what the fund is paying and will vary month to month as the PPS goes up or down.

      14.43% is enticing now that one can't find any place to make a decent interest investment.

      Just have to wonder how much farther the PPS can fall.

      I guess it could go all the way to 0 if many of the issuers go bust.....

    • You mean 9.48% and 9.15% instead. The payout over the last 12 months was at 10.55% at the price of $6.33

      Fund payout and the bonds yield are two different things thou. Their bonds are yielding 13.75% to maturity. Their spread to the 10 year treasury is high.

    • I think that you mean a average monthly payout of .05, not .50.

      But, .05 times 12 equals .60, divided by 6.33 equals .0948 per cent.

      And, has Sphix averaged .05 per month? The current payout, according to Fidelity quote, is .0489, which, divided by today's closing price of 6.41, would be an annualized .0915 percent.

    • Yes, it became verrrry attractive.

      I just exchanged some of the fixed income of a 401K into this fund. The price and yield became to good to be true. Thanks to the people who moved their money into safer fixed income which won't even keep up to inflation.

    • Thanks, will take a look at Vanguard.

      Love to say it's time to go in, but I think 15%+yield is more like it with a price around $5.


      If you are putting up more than $100,000, try to TALK TO THE MANAGER-they will give you a minute of their time on occasion.

    • One additional thought on high yield bond information, you may wish to visit the Vanguard High Yield Board that is far more active than the Fidelity Edition:

      With this said, Earl McEvoy, the former long term VWEHX has retired.

      The new manager is relatively young and has not been the primary manager of any fund previously to my knowledge. Under the tenet that money has no courage, I have transferred my high yield holdings from Vanguard to Fidelity in that the Fidelity manager has directed it’s fund for over 10-years. Additionally, Fidelity is reported to have an excellent in house bond research department. Lastly, assuming we hopefully are at or near a bottom, the Fidelity Fund is more aggressive than VWEHX and more upside is likely.

      Best of luck!

    • Think of the actual dividend rate and the SEC rate as the rates stated for e.g., a 5-year bank CD. The overall rate to maturity is significantly greater than the daily/monthly rate in that the interest paid is not removed from the CD proper. The retained interest compounds on itself to produce greater final returns.

      It is generally stated that high yield funds are best thought of as stock substitutes vs. bond funds in that significant capital gains or losses may occur. A prime example of base value capital losses has definitely occurred over the last year and particularly the past week. On the theory that buying low is a good thing, all high yield funds are bruised and battered and thus, technically attractive.

      As a primary interest source, it will be difficult to find a greater income source than a high yield fund with a reasonable expectation of not failing. Again, capital losses can and do occur but only if you sell the fund. The rate of payment will fluctuate depending on the individual bonds held.

      I hope this helps and several books are available on high yield bond investing to further assist you. Almost all libraries have a reference source available. Best of luck to you and all as we are in extremely difficult times. English is my second language and hopefully my message is clear.

    • I don't understand. Could you explain in more detail?

      The monthly dividend is .0512 x 12 equals .6144 annually, divided by 8 (current price) gives an annual yield of .0768.

      Where does the .09 % come in?

      I am looking for current income.

    • I think its worthwhile to wait until the financial credit stabilizes otherwise you can be in for a long ride down

8.21-0.02(-0.24%)Nov 24 6:45 PMEST