Global institutional investors are looking to mitigate risks amid concerns about a downturn in the economic cycle, according to BlackRock’s annual survey of global institutions, prompting Money Management to single out some global bond funds that have performed well over the last three years.
Over half of respondents (56 per cent) stated that the possibility of the cycle turning was one of the most important macros risks influencing their rebalancing and asset allocation plans, and over half (51 per cent) also intended to decrease their allocation to public equities.
Edwin Conway, global head of BlackRock’s institutional client business, said as the economic cycle turns, private markets could help clients navigate the more challenging environment.
“We have been emphasizing the potential of alternatives to boost returns and improve diversification for some time, so we’re not surprised to see clients increasing allocations to illiquid assets, including private credit,” he said.
Almost a third (29 per cent) of respondents intended to increase allocations to fixed income last year, and 38 per cent intend to do so this year.
Data from FE Analytics shows Invesco’s Senior Secured Loans fund took out the top spot for the three years to 30 November 2018, with returns of 5.88 per cent as compared to the global...