“Compound interest is the eighth wonder of the world”, said Albert Einstein. Over the past decade, Fixed Income investors weren’t able to fully experience this wonder, as historically low and even negative yields obscured the power of compounding.
Fortunately, since mid-2022, yields have roared back, firmly establishing rates in positive territory, and providing investors with a multi-decade opportunity and enticing entry points. Global sovereigns and corporate bonds offer yields last seen in 2011.
However, to truly benefit, investors will have to keep their eyes open. While external concerns have diminished, specific and idiosyncratic risks are gaining prominence across Fixed Income asset classes.
Read more: In a land of opportunities… select carefully | Candriam (candriamoutlook.com)
