Solving the income puzzle

EQUITY INVESTING

Kathleen Gaffney, co-director of investment grade fixed income group at Eaton Vance, explains how to create income portfolios which are relevant to today's market.

In today’s painfully low-yield environment, investors are starved for income. But with interest rates near generational lows across many traditional fixed income markets, the usual sources are not bearing much fruit these days.  Historically, high-quality bonds – those in the government and investment grade corporate sectors of the market – have accounted for the core of an investor’s income portfolio. The challenge today is bond prices across these core sectors are extremely high, offering only meager yield opportunities for investors.  This is because interest rates have been dri...