Perspectives Blog

New taxes require strategies to maximize after-tax return

Abram Claude, Vice President, Columbia Management Learning Center | March 18, 2014

Higher earners with taxable investments are most susceptible to triggering the net investment income tax, a surtax of 3.8% that applies to taxable investments. An asset location strategy involves placing a greater percentage of the most tax-sensitive investments in tax-deferred accounts. Retirement plans offer significant opportunities for participants and business owners to reduce taxable income. In 2013, new taxes associated with the Afforda…

Holding multiple investments does not ensure better diversification

Columbia Management, Investment Team | April 23, 2014

…eaningful additions to traditional allocations, substantially enhancing diversification. By Todd White, Head of Alternative Investments and Kent Peterson, Ph.D., Senior Portfolio Manager Most investors are familiar with diversification — reducing one’s risk profile (i.e., annual volatility) without affecting return by adding different asset classes or investments to your portfolio. While this is true, the degree of risk reduction benefit depends…

A port in the storm — Short muni funds can offer refuge in the face of rising rates

Catherine Stienstra, Senior Portfolio Manager | October 2, 2014

…may make sense in a rising rate environment. They provide attractive yields and investment flexibility vs. cash investments and interest rate protection vs. longer assets. Cash investments have come with considerable opportunity cost in recent years. Co-authored by James Dearborn, Head of Municipal Bond Investments 2014 has offered many investment surprises, perhaps none bigger than the downward move in yields across virtually all fixed-income…

Compelling opportunity in municipal bonds

Catherine Stienstra, Senior Portfolio Manager | November 7, 2013

…yield. State income taxes may be applicable and can further reduce the after-tax returns of some municipal bond investments (depending on the state of residence). Income from certain tax-exempt securities may be subject to the federal and/or state alternative minimum tax for some investors. In addition, federal and state income tax rules will apply to any capital gain distributions and capital gains or losses on sales. When investing in municipa…

Opportunities in global infrastructure

Peter Santoro, Senior Portfolio Manager | February 3, 2014

Infrastructure investments may offer stable cash flows and diversification from more cyclical investments Infrastructure investments span the emerging and developed markets across many industries Today’s current market environment offers unprecedented opportunities for well-resourced investors Infrastructure represents the foundation for our day-to-day lives—the societal staples we rely on. And the stable fundamental demand drivers of infrastr…

What’s the outlook for muni bonds?

James Dearborn, Head of Municipal Bonds | June 19, 2014

…yield. State income taxes may be applicable and can further reduce the after-tax returns of some municipal bond investments (depending on the state of residence). Income from certain tax-exempt securities may be subject to the federal and/or state alternative minimum tax for some investors. In addition, federal and state income tax rules will apply to any capital gain distributions and capital gains or losses on sales. When investing in municipa…