Rathbones' Jones: why this'll be a tough year for bond managers

Over the course of the year, investors are expected to gradually 'rotate' into equities as strong performances in fixed income markets have precipitated several headlines about bond bubbles. Despite the significant contraction of spreads in certain bond indices over the last year (the Iboxx Non-Gilt index, for example), there is still value in some areas. Furthermore, as the hunt for yield abounds, we believe that increasing the quality of ones’ portfolio, versus chasing scarce yield, will become more of an issue as the year progresses. We have already started to switch out of some lo...