Aviva Investors' Chris Higham has slashed risk exposure in his £1.6bn Corporate Bond and £96m Strategic Bond funds, shifting 25% of the portfolio into cash on fears of a bubble forming in risk assets.
The manager has upped his cash levels in the Strategic Bond fund over the past six months from zero to roughly 10% in cash and 15% in cash equivalents, including index-linked government bonds. He has also taken risk off the table in Corporate Bond fund by increasing exposure to AAA-rated companies by 10%. "We have taken a fair amount of risk off in recent months. There are so many headwinds it does not pay to have too much risk on right now," said Higham. "Our subdued outlook for developed markets, an influx of liquidity increasing the risk of market bubbles, and contagion risk associ...
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