Multi-asset managers negative on bonds

Merrills and Investec managers are both largely negative on asset class, with low bond yields and widening credit spreads damaging returns

Multi-asset managers are largely negative on bonds, with equity weightings dictating returns in recent months. Over three months to the end of June, active managed funds, which can go up to 100% in equities, produced an average return of 3.4%. "Balanced Managed vehicles, which have an 85% cap on equities, returned 2.8%, while Cautious Managed produced 0.7%. According to research from Standard & Poor's (S&P), this is a continuation of the year-to-date trend. In the six months to the end of June, UK equities returned 7.8% against -3.1% from gilts and -3.0% from sterling corporates. S&P a...