Invesco Senior Income INVESCO Bond
| VVR Fund | USD 3.95 0.03 0.77% |
Invesco Senior Income holds a debt-to-equity ratio of 0.393. . Invesco Senior's financial risk is the risk to Invesco Senior stockholders that is caused by an increase in debt.
Asset vs Debt
Equity vs Debt
Invesco Senior's liquidity is one of the most fundamental aspects of both its future profitability and its ability to meet different types of ongoing financial obligations. Invesco Senior's cash, liquid assets, total liabilities, and shareholder equity can be utilized to evaluate how much leverage the Fund is using to sustain its current operations. For traders, higher-leverage indicators usually imply a higher risk to shareholders. In addition, it helps Invesco Fund's retail investors understand whether an upcoming fall or rise in the market will negatively affect Invesco Senior's stakeholders.
For most companies, including Invesco Senior, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Invesco Senior Income, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Invesco Senior's management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
Invesco |
Given the importance of Invesco Senior's capital structure, the first step in the capital decision process is for the management of Invesco Senior to decide how much external capital it will need to raise to operate in a sustainable way. Once the amount of financing is determined, management needs to examine the financial markets to determine the terms in which the company can boost capital. This move is crucial to the process because the market environment may reduce the ability of Invesco Senior Income to issue bonds at a reasonable cost.
| Popular Name | Invesco Senior INVESCO FIN PLC |
| Specialization | Bank Loan |
| Equity ISIN Code | US46131H1077 |
| Bond Issue ISIN Code | US46132FAC41 |
| S&P Rating | Others |
| Maturity Date | Others |
| Issuance Date | Others |
| Coupon | 5.375 % |
Invesco Senior Income Outstanding Bond Obligations
| MPLX LP 52 | US55336VAL45 | Details | |
| INVESCO FIN PLC | US46132FAD24 | Details | |
| INVESCO FIN PLC | US46132FAC41 | Details |
Understaning Invesco Senior Use of Financial Leverage
Invesco Senior's financial leverage ratio measures its total debt position, including all of its outstanding liabilities, and compares it to Invesco Senior's current equity. If creditors own a majority of Invesco Senior's assets, the company is considered highly leveraged. Understanding the composition and structure of Invesco Senior's outstanding bonds gives an idea of how risky it is and if it is worth investing in.
Invesco Senior Income Trust is a closed ended fixed income mutual fund launched by Invesco Ltd. It is co-managed by Invesco Advisers, Inc., Invesco Asset Management Deutschland GmbH, Invesco Asset Management Limited, Invesco Asset Management Limited, Invesco Australia Limited, Invesco Hong Kong Limited, Invesco Senior Secured Management, Inc., and Invesco Canada Ltd. The fund invests in the fixed income markets of the United States. It primarily invests in a portfolio of interests in floating or variable rate senior loans to corporations, partnerships, and other entities which operate in a variety of industries and geographical regions. The fund typically employs fundamental analysis with a bottom up stock picking approach to create its portfolio. It benchmarks the performance of its portfolio against the Credit Suisse Leveraged Loan Index. The fund was formerly known as Invesco Van Kampen Senior Income Trust and Van Kampen Senior Income Trust. Invesco Senior Income Trust was formed on June 23, 1998 and is domiciled in the United States. Please read more on our technical analysis page.
Pair Trading with Invesco Senior
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Invesco Senior position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Invesco Senior will appreciate offsetting losses from the drop in the long position's value.Moving against Invesco Fund
| 0.85 | LETRX | Voya Russia Fund | PairCorr |
| 0.75 | GAPIX | Goldman Sachs Equity | PairCorr |
| 0.68 | LIGYX | Loomis Sayles Intern | PairCorr |
| 0.67 | AMGIX | Income Growth | PairCorr |
| 0.66 | KSCYX | Kinetics Small Cap Steady Growth | PairCorr |
The ability to find closely correlated positions to Invesco Senior could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Invesco Senior when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Invesco Senior - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Invesco Senior Income to buy it.
The correlation of Invesco Senior is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Invesco Senior moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Invesco Senior Income moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Invesco Senior can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.Other Information on Investing in Invesco Fund
Invesco Senior financial ratios help investors to determine whether Invesco Fund is cheap or expensive when compared to a particular measure, such as profits or enterprise value. In other words, they help investors to determine the cost of investment in Invesco with respect to the benefits of owning Invesco Senior security.
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What is Financial Leverage?
Financial leverage is the use of borrowed money (debt) to finance the purchase of assets with the expectation that the income or capital gain from the new asset will exceed the cost of borrowing. In most cases, the debt provider will limit how much risk it is ready to take and indicate a limit on the extent of the leverage it will allow. In the case of asset-backed lending, the financial provider uses the assets as collateral until the borrower repays the loan. In the case of a cash flow loan, the general creditworthiness of the company is used to back the loan. The concept of leverage is common in the business world. It is mostly used to boost the returns on equity capital of a company, especially when the business is unable to increase its operating efficiency and returns on total investment. Because earnings on borrowing are higher than the interest payable on debt, the company's total earnings will increase, ultimately boosting stockholders' profits.Leverage and Capital Costs
The debt to equity ratio plays a role in the working average cost of capital (WACC). The overall interest on debt represents the break-even point that must be obtained to profitability in a given venture. Thus, WACC is essentially the average interest an organization owes on the capital it has borrowed for leverage. Let's say equity represents 60% of borrowed capital, and debt is 40%. This results in a financial leverage calculation of 40/60, or 0.6667. The organization owes 10% on all equity and 5% on all debt. That means that the weighted average cost of capital is (.4)(5) + (.6)(10) - or 8%. For every $10,000 borrowed, this organization will owe $800 in interest. Profit must be higher than 8% on the project to offset the cost of interest and justify this leverage.Benefits of Financial Leverage
Leverage provides the following benefits for companies:- Leverage is an essential tool a company's management can use to make the best financing and investment decisions.
- It provides a variety of financing sources by which the firm can achieve its target earnings.
- Leverage is also an essential technique in investing as it helps companies set a threshold for the expansion of business operations. For example, it can be used to recommend restrictions on business expansion once the projected return on additional investment is lower than the cost of debt.