FFixed income investors have had it easy over the past three decades, but with the current environment of higher inflation and the outlook for rising rates, the traditional bond portfolio will need to adapt to the challenges ahead.
In the next webcast, How to make your fixed income allocation sustainable, Matthew Bartolini, SPDR® Americas Research Manager at State Street Global Advisors; Scott Ladner, CIO of Horizon Investments; and Komson Silapachai, research and portfolio strategy partner at Sage Advisory, will question the allocation allocations of the traditional equity and bond portfolio, highlighting alternative investment strategies that could help better diversify risk and maintain returns for changing market conditions.
For example, something like the SPDR Bloomberg High Yield Bond ETF (JNK) could help increase income generation for bond investors. The SPDR Bloomberg High Yield Bond ETF seeks to provide investment results which, before fees and expenses, generally correspond to the price and return of the Bloomberg High Yield Very Liquid Index. The fund is a more profitable way to implement high yield exposure than through individual bonds.
Fixed income investors could supplement existing credit positions in high yield, investment grade credit with alternatives such as bank loans that access variable rates, increase capital structure and reduce duration exposure. . Active management SPDR Blackstone / GSO Senior Loan ETF (NYSEArca: SRLN) could help investors gain better exposure, as a manager can more freely enter and exit the fixed income market. Blackstone / GSO, which sub-advises SRLN, is backed by one of the world’s largest senior loan asset managers.
Bond ETFs such as SPDR Portfolio Mortgage Backed Bond ETF (SPMB), the SPDR Portfolio Short Term Corporate Bond ETF (NYSEArca: SPSB), the SPDR Portfolio High Yield Bond ETF (SPHY), and the SPDR Barclays Convertible Securities ETF (NYSEArca: CWB) could also help investors seek total return through other fixed income options.
Financial advisors who want to learn more about fixed income strategies can register here for the Tuesday November 9 webcast.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.