I think investment grade credit is the sweet spot for fixed
income this year. There's been a huge repricing in government
bond yields around the world which present investors with
attractive yield opportunities in government bonds.
But in investment grade, we see value and adding exposure to
companies over and above those government bond yields.
We think companies are in good shape and that the credit
spreads are good value at the moment.
Most importantly, though, when you combine a risk free rate
with a credit spread, a risk premium, the combination of those
two things together in a bond or corporate bond fund,
give investors an in-built hedge meaning that if credit spreads
widen and risk does badly, all of the losses from that
could be offset by a rally in risk free rates.