Duration outperforms despite rate hike concerns
Long duration funds outperformed in the second quarter of 2018, despite investors’ ongoing concerns around interest rates.
Long duration funds outperformed in the second quarter of 2018, despite investors’ ongoing concerns around interest rates.
The Neuberger Berman Emerging Market Debt Local Currency Fund has reduced currency and duration risk in the portfolio following underperformance against the benchmark over the last quarter.
Fixed asset allocation in the passive Vanguard Lifestrategy range has seen duration soar above 9 years, so how are active multi-asset managers positioned as interest rates look set to rise?
Advisers continue to favour Vanguard Lifestrategy for multi-asset exposure, despite concerns the range’s high duration leaves investors exposed to rising interest rates.
Vanguard’s £9.6bn Lifestrategy range is exposing investors to interest rate risk, as governments and corporates buying up cheap, long-dated debt skew duration in indices that the passives giant tracks.
Candriam has expanded its fixed income range with the launch of a total return defensive bond fund.
Two asset managers have warned that bond investors, particularly those in passive vehicles, are too exposed to duration risk without realising it.
Though the recent uptick in inflation expectations and the Trump-fuelled reflationary trade have scared many investors away from government bonds, five portfolio managers argue there is still value to be found.
David Riley, head of credit strategy at BlueBay Asset Management discusses regime change, the risk benefits of reflation, and the dangers lurking in duration.
Fixed income diversification is crucial in the current environment says LGIM’s Justin Onuekwusi, but it is not, in and of itself, enough.
Short duration bonds are key to mitigating volatility in bond holdings, according to Jim Veneau, Axa Investment Managers head of fixed income in Asia.
Julia Ho explains how Asia is uniquely positioned to benefit whatever the global economic newsflow.