James Foster: So why pick a strategic bond fund?

Benchmarking can cause issues

clock • 4 min read

The best opportunities in bond markets change over time, says James Foster, making it important to be able to take a flexible approach to fixed income investing

While traditional bond funds tend to restrict themselves to one area of the fixed income market, strategic bond funds can invest across the credit spectrum. They can move between government bonds and those issued by corporate borrowers - whether these are classed as ‘investment-grade' (bonds rated BBB or above) or ‘high-yield' (those rated below BBB). A flexible approach allows these funds to adapt quickly to changing market conditions. By owning the right bonds for each stage of the economic cycle, capital can be preserved in difficult times with the aim of profiting when conditions imp...

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