Asset Allocation Strategy
Fixed Interest in a World of Ultra-Low Rates
Mon 24th August, 2020

The fixed interest portion of diversified portfolios has traditionally been used to dampen the volatility of risk assets and optimise the risk/return efficiency of portfolios.

Fixed interest has also had the ability to provide portfolio income enhancement, however, with the relentless decline in fixed interest yields over several decades this role has diminished.

The huge decline in available yields naturally poses the question of whether an allocation to fixed interest is still worthwhile?

We still think the answer is yes, but believe investors need to consider non-traditional types of fixed interest strategies, alongside a broader range of portfolio diversifiers.

Disclaimer and disclosures

Recommendation structure, definitions and the Financial Services Guide (“FSG”) can be found at www.wilsonsadvisory.com.au/disclosures.

Disclaimer

This document has been prepared by Wilsons Advisory and Stockbroking Limited (AFSL 238375, ABN 68 010 529 665) (“Wilsons”) and its authors without consultation with any third parties, nor is Wilsons authorised to provide any information or make any representation or warranty on behalf of such parties. Any opinions contained in this document are subject to change and do not necessarily reflect the views of Wilsons. This document has not been prepared or reviewed by Wilsons' Research Department and does not constitute investment research. Wilsons makes no representation or warranty, express or implied, as to the accuracy or completeness of the information and opinions contained therein, and no reliance should be placed on this document in making any investment decision. Any projections contained in this communication are estimates only. Such projections are subject to market influences and contingent upon matters outside the control of Wilsons and therefore may not be realised in the future. Past performance is not an indication of future performance.

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Written by

David Cassidy, Head of Investment Strategy

David is one of Australia’s leading investment strategists.

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