Higher bond yields and strong levels of dividend growth mean income-bearing assets currently offer investors an excellent opportunity, either income for its own sake or as a contribution to strong prospective total return.
We believe income bearing assets will continue to provide attractive opportunities for total return investors in 2024 and beyond.
- With inflation expected to fall, the normalisation of the interest rate cycle will provide opportunities for strong total returns, particularly from good quality high yield bonds.
- Global equity dividends will maintain strong pay-outs and robust share buyback activity, while their natural defensive qualities will continue to offer protection in volatile markets.
- As rates fall and the yield available from cash declines, the through-cycle consistency of income from bonds and equity dividends will be increasingly attractive.
Investment experts across Aegon Asset Management's equities, high yield bonds and multi-asset platforms discuss the merit of income as a source of total return and make the case for each asset class.
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Opinions and/or example trades/securities represent our understanding of markets both current and historical and are used to promote Aegon Asset Management's investment management capabilities: they are not investment recommendations, research or advice. Sources used are deemed reliable by Aegon Asset Management at the time of writing. Please note that this marketing is not prepared in accordance with legal requirements designed to promote the independence of investment research, and is not subject to any prohibition on dealing by Aegon Asset Management or its employees ahead of its publication.
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