The twin risks of bond investing

clock • 7 min read

The year of the corporate bond fund has been a tug of war between duration risk and systemic risk

Despite a rather wobbly start, 2009 has been the year of the corporate bond fund. According to the latest Investment Management Association data, the Sterling Corporate Bond sector continues to be popular with UK investors, with July’s inflows of £466.6m confirming it as the preferred asset class for investors for the ninth consecutive month. For the year to date (to the end of July), the sector has pulled in an impressive £5.3bn in retail net sales, compared to a total retail net inflow of £14bn across all sectors. The attraction of corporate bonds over this period is readily apparent. ...

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