Defensive assets

Protecting the underside of portfolios, and even thriving through moments of market distress, can keep more fretful clients out of the danger zone. A new generation of products are designed to do just that, and without sacrificing the lion’s share of outsized returns when markets run hot.

The tranche market isn’t the defining feature of Fortlake’s fixed income funds, Baylis explained, but it’s a pivotal tool for the firm’s managers and adds a critical element of non-correlative returns for investors.

It’s not impossible to find a good investment in private equity when interest rates are high, Harrex explained, but it’s a lot easier to find a good liquid alts investment in the current economic environment.

From gloomy retail clients to fretful global institutional providers, investment experts report a glaring disconnect between the risk appetite of investors and the overall economic outlook.

Despite increased volatility emanating from the banking sector, tech stocks have been supported by falling bond yields on fears the global economy could slip into recession this year, with big-name companies leading the gains.

Credit and equity markets both suffered a very bad 2022, as the collapse of negative correlation between stock and bond prices left no safe haven for investors. But 2023 could be a big year for bonds, with analysts warning investors waiting on the sidelines that they risk missing out.

The British investment firm’s current cash weightings have hit historic levels after perceived risks in the global economy moved it to help preserve rather than accumulate capital.

Australian non-bank lenders are making incursions against the big banks, but have many considerations during the loan decision making process to ensure proper loan structuring.

Debt assets may be de jour, but the income they produce is fraught with peril if it doesn’t include the kind of diversity senior secured loans provide.

Atchison Consultants’ Kevin Toohey on why bond benchmarks only cover a slice of a diverse universe.

History has shown that investing into bank loans and credit markets at or near current valuation levels has delivered high single digit and double digit returns over the long-term.

In a challenging environment plagued with uncertainty and volatility, rising inflation has turned investors away from risky growth assets.