Fixed Interest

Schroders sees the second half of 2023 as a once in a decade opportunity to be back allocating to fixed income from a cyclical perspective.

The current environment is offering both attractive yields over medium-term investment horizons and good diversifying potential as the cycle turns.

The income desert is behind us – nevertheless, as Dorian Carrell and Joven Lee from Schroders explain, investors still need to navigate new income opportunities with care.

Mihkel Kase explains why Schroders has been deploying cash and increasing its portfolio’s interest rate and credit risk via high quality credit, as inflation peaks and growth weakens.

The recent shift from yield-scarcity to abundance must be approached carefully as higher rates make the environment more difficult and add to financial stress.

It is premature to think it is smooth sailing ahead but as you position your investments for the year, consider reinstating fixed income as a stabilizer in your portfolio.

With fixed income now offering good value and the cycle potentially turning in favour of bonds, Schroders are confident 2023 will look significantly different for this asset class.

With early signs that inflation is peaking and central banks likely to slow monetary tightening, Schroders are looking to take advantage of the improved outlook for fixed income.

Shares, bonds, and alternative asset classes tend to dominate media attention and headlines, but there’s a forgotten asset class that underpins most investors’ portfolios: cash.

Central banks continue to aggressively fight inflation; growth seems to be slowing. Schroders’ Stuart Dear thinks this could mark the turning point where fixed income returns improve dramatically.

The overwhelming confluence of factors currently at play has caused some pain and apprehension in the market, but they can also be a cause for optimism, says Schroders’ Kellie Wood.

Janus Henderson’s Jay Sivapalan and Dinesh Kuhadas discuss how realistic the market’s cash rate expectations are given the potential for harm to the economy and financial stability.

To help you make heads or tails of hybrids, Roy Keenan, Co-Head of Australian Fixed Income at Yarra Capital Management, shares his six principles for investing in these products.

With interest rates now close to record lows, the scope for bond yields to fall appears limited. In turn, fixed income funds might struggle to maintain their strong recent performance.

Covid and its associated consequences have forced many businesses to survive on debt, not economic viability. This, as Magellan’s Michael Collins argues, increases the risk of broader financial instability.

Market returns across most asset classes have been supercharged since the lows of March 2020, spurred by accommodative monetary policy, stimulatory fiscal policy and an improving global economic outlook as the COVID vaccine rollout gathers pace.

The extraordinary monetary and fiscal policy response to the COVID-19 crisis has been very successful in minimising the damage to the global economy, but has also had profound implications for portfolio construction.

If investors are willing to expand their horizons, they stand a much better chance of meeting their investment goals. Here are three compelling reasons to go global and multi-sector.