2008’s star investment
The flavour of 2008 is shaping up to be Australian government bonds as investors seek capital preservation during uncertain times, according to the latest Schroder Investment Management market outlook.
Penned by the asset manager’s head of fixed income and multi-assets, Simon Doyle, the report claims that Australian government bonds should deliver decent positive returns during 2008 as risk assets rapidly decline.
Asset market performance during the last 12 months support this outlook, with government bonds delivering 1.4 per cent compared to the negative 14.5 per cent of listed property trusts, negative 6.0 per cent of Australian shares and negative 6.6 per cent of global equities.
“2008 may be the year when Australian government bonds creep their way back into the hearts of investors,” Doyle said.
Doyle believes that for the next few months at least volatility is likely to remain elevated, with global credit spreads continuing to widen and equity markets trending lower.
However, he added that, as a result, credit and liquidity risk premiums would be restored across the curve, eventually making credit assets attractive again.
Recommended for you
An adviser has received a written reprimand from the Financial Services and Credit Panel after failing to meet his CPD requirements, the panel’s first action since June.
While efficiency remains a top priority for Australian advisers, State Street has revealed the profession is now juggling this desire with the need to maintain personalisation of its service offering.
A possible acquisition of data provider Iress is becoming a greater likelihood after the firm announced it is engaging with multiple interested parties.
AMP has reported a 61 per cent rise in inflows to its platform, with net cash flow passing $1 billion for the quarter, but superannuation fell back into outflows.
