Nick Hayes, manager of the AXA Sterling Strategic Bond fund, explains how he is positioning his portfolio in preparation for future bouts of volatility.
As a bond investor, these are indeed unusual and uncertain times. Rather than fundamentals driving the current market environment, it is being driven by a combination of political agenda and macroeconomic newsflow. Such an environment, where market fundamentals are largely ignored amid the wall of macro ‘noise’, can lead to extremes in valuations, a scenario we are currently seeing. There is no question that this environment is a difficult one for bond investors to negotiate. However, key amid such swinging ‘risk on, risk off’ sentiment is to remain vigilant and highly-responsive to the...
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