Corporate Credit Recommended for Fixed-Income Portfolios
Dow Jones10-14
1450 ET - High government bond yields, combined with resilient economic growth, calls for a fixed-income strategy that reduces duration while leaning into corporate credit, Morgan Stanley's Jim Caron says. He recommends keeping duration shorter than major benchmark indices while increasing exposure to credit, as corporate results remain robust. Caron says high-yield names with credit rating as low as BB offer stable cash flows and low default risks. "What I'm trying to reduce is the interest rate sensitivity and I'm trying to amplify the credit risk component of the portfolio," he says. Caron says tax-exempt municipal bonds are also attractive, supported by strong demand from buy-and-hold investors.
At the request of the copyright holder, you need to log in to view this content
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
Comments