Owning gilts has made the single largest contribution to recent performance of the £761m Miton Special Situations fund, and there is more money to be made in the asset class, said manager Martin Gray.
Eurozone finance ministers have rejected a reported €3.3bn package of Greek budget cuts, dashing hopes the country will secure more bailout cash and avoid default.
Equities are likely to post gains in 2012 whatever the outcome of the sovereign debt crisis in Europe, according to Richard Peirson, manager of the £347m AXA Framlington Managed Balanced fund.
Barings' multi-asset team has bought £350m in Italian government bonds in the expectation European banks will use the ECB's Long Term Recovery Organisation (LTRO) to buy government debt.
The euro needs to see a sharp fall of at least 30%, bringing it into line with the US dollar, or else the eurozone is "doomed", Nouriel Roubini has warned.
The International Monetary Fund (IMF) has cut forecasts for UK economic growth this year, warning GDP will grow by just 0.6% in 2012.
Neptune's Rob Burnett has shifted his £946m European Opportunities fund back to a defensive stance in the view pressures in Europe, the US and China will result in 'vulnerable' markets for the rest of Q1.
Threadneedle has launched a Luxembourg-domiciled European Absolute Alpha fund for pan-European equity manager Paul Doyle.