Important updates:
🔹 On February 12th, a representative from the local Edward Jones office will speak to Investment Club about their job and what led them there in their career path.
🔹 The Viking Fund is now up and running. The Investment Club endowment fund has a starting balance of $1,000 from an anonymous donor. Presentations for investments will be held and formally voted on to decide what the club invests in.
This meeting, Cameron gave a presentation on fixed income, its different forms, risks, and benefits. Some examples of fixed-income assets are Bonds, U.S. Treasuries, and Certificate of Deposits (CDs). The club talked about risks, tax benefits, and how bonds are graded.
These different assets have different terms of maturing. Treasury bills are short-term, these mature between 4 and 52 weeks. Treasury notes are medium-term, these mature between 2-10 years. Treasury bonds are more long term and mature in a term of 20 or 30 years. These assets can be bought and sold before they mature. CDs allow a person to earn interest on their savings. Most CD’s range from 3 months to 10 years to mature. CDs do have a penalty if money is withdrawn prematurely. (TIPS) are Treasury Inflation-Protected Securities, these assets adjust interest rate payments to combat value change from inflation.
Money market funds are a similar alternative to fixed-income assets. Money Market funds combine many different investments. The returns vary from a given fixed income but generally have higher yields than other cash alternatives. The goal of money market funds is to diversify risk while maintaining liquidity. These assets reduce overall gains but keep money safer than alternatives like a single common stock.
Additionally, the club discussed ongoing market developments and current news regarding Nvidia, Intel, Oracle, AI, TSMC, and the possible tariffs on Taiwan. The club also talked about current and upcoming earnings reports.
The club also spent time rediscussing options trading and how buying/selling calls and puts work. (shown below)
So, how do bonds and other fixed income assets apply to today’s market?
These assets have less volatility but a lower percentage gain. Bonds, generally speaking, are safer than stocks, provided the country or company doesn’t default. Essentially, the investor is forgoing opportunity cost for safety. Because of this safety, many people use bonds to preserve capital and obtain some profit whilst also avoiding volatility and risk.
Next meeting VU567, 5:45-7:00 PM, 2/5!
Categories: Club Updates
