Bond investors face 'years in doldrums'

The firm says the asset class has provided strong returns for investors for years but claims that, in times of rising inflation, they “generally respond negatively”. It says investors should look to replace bonds with assets which offer inflation protection, such as Treasury Inflation Indexed Securities (TIPS), and real assets like real estate and commodities. In addition, Julius Baer says the risk of a global collapse seems to have been averted but warns the credit crunch “could still unleash further aftershocks”. Christian Gattiker-Ericsson, head of research at Julius Baer Investment P...