Riding cycle requires some caution

bonds

Bonds have made good returns in recent years, but with investment grade bonds close to fully priced, investors should consider funds protected with credit derivatives

The ever increasing appetite for UK bonds shows little sign of slowing, whether in institutional portfolios such as pension and life funds, or in private investors' savings allocations. Recently published Investment Management Association statistics demonstrate a huge appetite for this asset class that has, quite simply, been a great place to be for the last few years. Just as in the commercial property space, the falling yield environment has generated large capital gains for investors in most sectors in the fixed income universe since the start of the millennium. Discretionary asset allo...