Three benefits of higher income in fixed income
The stability, dominance and buffer attributes of yields in a higher income world
Key highlights:
Key highlights:
- A recent sharp repricing higher of interest rates across the yield curve has led to considerably higher yields on offer in most fixed income sectors today.
- Over the long-term, yield (as opposed to price) is by far the most stable and reliable component of total return for bonds.
- Higher break-evens (from higher yields) act as “shock absorbers”.
- Investors no longer need to reach for higher yield by taking unnecessary credit or interest rate risk.