Bonds can still provide protection for investors

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Mark Benstead of Legal & General Investment Management
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Mark Benstead of Legal & General Investment Management

Bond bears thought their time had come in 2018.

Yields rose sharply in Q3, and with 10-year gilts hitting 1.72% in early October, the annual clarion call for higher yields finally looked to be playing out. But it was not to be. The new year brought weaker economic data and trade war fears, which sent 10-year gilt yields plunging towards 0.7% at time of writing. Credit spreads, after a torrid end to 2018, have performed well this year, benefitting from the prospect of extra return at such low yields. Sterling investment grade has returned 7.5% year-to-date after 2018 was its first negative year since 2008. Are investment grade...

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