Fixed income fails investors (The Aust 21/08/18)

One of the biggest dilemmas for investors in recent years has been how to reconcile the poor returns from fixed-interest allocation with the need for a balanced investment portfolio.

Simply put, Fixed Income has failed to deliver returns. You don’t want to be fixed (duration) and it doesn’t produce much income.

As an investor you need to take these factors into account and having defensive positioning in portfolios is important. However, cash can provide a return in excess or equal to that of government bonds — with a reduced risk profile.