Fidelity checks climate for short-dated duration bonds

Fidelity is looking at the feasibility of launching a short-term duration bond fund, investing in mi...

Fidelity is looking at the feasibility of launching a short-term duration bond fund, investing in mix of corporate and government bonds and floating rate notes (FRNs). While short-dated bonds are more at risk to interest rate rises than longer-dated paper, Martin Hall, head of fixed income at Fidelity, believes their capital risk is lower because of their shorter duration. He said for investors wary of returning to the equity market, but who are concerned about reports of a bond bubble, short-term duration bonds may provide a useful alternative to the two asset classes. Hall also believe...