Finding yield by being nimble in multi-asset credit

The lack of yield is one of the top concerns among pension funds and many other investors today. Central banks continue to intervene in the capital markets and expand their balance sheets.

And this trend shows no signs of slowing, with the Federal Reserve cautious approach toward policy rate hikes, interest rates in Europe and Japan in negative territory, and some of the longest duration exposure in fixed income we’ve seen in a long time.

To adapt to this new environment, pension funds are seeking to supplement traditional approaches to be able to generate incremental returns in the future. The European Central Bank’s asset purchase program also means that fewer high quality assets are available for institutional investors to hold. As a result, many investors are looking for ways to enhance their portfolios on a risk-adjusted basis. We think multi-asset credit (MAC) strategies present a compelling opportunity for pension funds in an environment of shifting markets and, eventually, rising interest rates.

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