End of panic means it is time to build corporate and high yield exposure

The last year was a very difficult time to be a bond investor. Debt securities were at the epicentre...

The last year was a very difficult time to be a bond investor. Debt securities were at the epicentre of the panic that has dominated financial markets since August. Non-government bonds were hit especially hard as the sub-prime debacle undermined the value of credit ratings and spread contagion throughout the market. Both corporate and high yield bonds lost money. Government bonds did better as investors speculated interest rates would have to be cut to relieve the credit crunch, but even here returns did not significantly beat the return from cash deposits as stubbornly high inflation limi...