IA Sterling Corporate Bond
Performance of sectors in 2022
IA UK All Companies ( -9.1 %)
IA Sterling Corporate Bond ( -16.1 %)
IA UK Gilts ( -23.9 %)
5 % |
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0 % |
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-5 % |
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-10 % |
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-15 % |
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-20 % |
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-25 % |
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-30 % |
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-35 % |
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Jan22 |
Mar |
May |
Jul |
Sep |
Nov |
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Source : FE Analytics |
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performing their role as a safe haven , Luis recommends looking at highquality developed market corporate debt instead .
“ Investment grade corporate bonds currently offer higher income and higher returns compared with developed market sovereign bonds ,” she explains . “ Combined , the yield and spread offer a buffer against rates , volatility and recession risk . In a recessionary environment , government bond yields typically fall , providing an uplift to long-dated investment grade .” Steve Ellis , global chief investment officer of fixed income at Fidelity , notes that several corporates surprised sterling markets in November by unveiling tender offers – offering to buy back their bonds from investors – which provided support to the asset class . “ We are moving to a positive outlook in sterling investment grade ,” he says . “ Valuations remain
Issue 91 - January 2023 / 55 /