From the income desk

Bonds back in focus

Ellie Clapton and Jason Borbora-Sheen explore the resurgence of bonds as a viable investment class.

Sep 24, 2024

7 minutes

Ellie Clapton
Jason Borbora-Sheen

With inflation and growth slowing, and a rate-cutting cycle on the horizon, the opportunity cost of staying in cash has risen. While bonds have become more attractive from a cyclical perspective, structural risks—such as the potential for persistent inflation—remain.

This makes shorter-term holdings, particularly those with increased duration, vulnerable to capital drawdown. Ellie and Jason highlight the importance of a nimble investment approach to managing these risks, including diversification beyond traditional markets. Ultimately, hedging and employing flexible, differentiated strategies are essential to managing duration risk and achieving better outcomes in an uncertain economic environment.

Authored by

Ellie Clapton
Portfolio Specialist
Jason Borbora-Sheen
Portfolio Manager

Important Information

This communication is provided for general information only should not be construed as advice.

All the information in is believed to be reliable but may be inaccurate or incomplete. The views are those of the contributor at the time of publication and do not necessary reflect those of Ninety One.

Any opinions stated are honestly held but are not guaranteed and should not be relied upon.

All rights reserved. Issued by Ninety One.

For further information on indices, fund ratings, yields, targeted or projected performance returns, back-tested results, model return results, hypothetical performance returns, the investment team, our investment process, and specific portfolio names, please click here.