Fixed income investments backed by 66% of IFAs Go compare with our comparison table

Fixed income investments backed by 66% of IFAs

01 February 2010 / by Andy Davies

Two thirds of independent financial advisers (IFAs) are confident that conditions for the fixed income market will remain positive this year, according to findings from a new report.

Following a survey of more than 400 IFAs at the ABC of Bonds Roadshow, one in five IFAs said they planned to encourage their clients to increase their exposure to fixed income investments over the next 12 months.

Meanwhile, greater diversification will be the focus for many IFAs as 86 per cent said they will recommend that their clients diversify their fixed income portfolios.

The most popular type of fixed income fund amongst IFAs appears to be the strategic bond as 65 per cent said they would recommend this fund to their clients, ahead of absolute return bond funds and corporate bond funds.

Commenting, Robert Thorpe, director of UK advisory sales at Cazenove Capital said: "Diversification will be one of the key themes in the fixed income market this year, and our research suggests that the biggest winners could be strategic bond strategies."

Meanwhile, Rod Aldridge, head of UK retail distribution at Barings, is not surprised a greater focus is being placed on the fixed income market as interest rates remain low.

"Higher rate taxpayers need to secure an interest rate on their savings of at least 3.17 per cent to beat the current level of inflation but only nine savings accounts out of nearly 800 offers this. This and the fact that there have been a number of attractive opportunities in the fixed income market have meant that investors have placed a greater focus on this sector," he said.

Reacting to diversification becoming a greater focus for many IFAs in 2010, Rob Bailey, head of UK sales at AXA Investment Managers, added: "With uncertainty surrounding some of the government debt issues I am not surprised to see that 39 per cent and 27 per cent of intermediaries plan to recommend investing in global bond funds and high yield bond funds respectively.

"These funds will offer investors added diversification and a greater spread of risk within their fixed income portfolios."

© Fair Investment Company Ltd 

 

 Product NameISA OptionIncome YieldMore Info
Henderson Strategic Bondyes5.7%More Info >
Income Paid Quarterly. Investing in higher yielding assets which will include most types of fixed interest securities, this fund aims to deliver a quarterly income to investors. See latest fund factsheet for details.
Newton Asian Incomeyes5.43%More Info >
Income Paid Quarterly.The objective of the Sub-Fund is to achieve income together with long-term capital growth predominantly through investments in securities in Asia Pacific ex Japan (including Australia & New Zealand) region. The Sub-Fund may also invest in collective investment schemes. See latest fund factsheet for details.
Newton Higher Incomeyes5.4%More Info >
Income Paid Quarterly. The objective of the Fund is to achieve increasing distributions on a calendar year basis with long term capital growth. The Fund may also invest in collective investment schemes. See latest fund factsheet for details.
Invesco Perpetual Distributionyes4.7%More Info >
Income Paid Monthly. Invesco Perpetual Distribution offers a balance between both income and capital growth through investment in UK based equities and fixed interest securities. See latest fund factsheet for details.
Invesco Perpetual Monthly Income Plusyes4.46%More Info >
Income Paid Monthly. Popular income fund that aims to achieve a high level of income whilst seeking to maximise total return through investing in high yielding corporate and Government bonds, together with UK equities. See latest fund factsheet for details.
Woodford Equity Income Fundyes3.50%More Info >
Our selected partner for investing in Neil Woodford's Equity Income fund is Barclays Stockbrokers, via their INVESTMENT ISA for new ISAs and ISA transfers, or their MARKETMASTER® ACCOUNT for non-ISA investments. Income Paid Quarterly.The fund’s investment objective is to provide investors with long-term appreciation through investing in stocks primarily listed on the UK stock exchanges. Up to 20% may be invested in international companies. The income objective is 10% higher than the FTSE All Share Index yield with an anticipated annual yield of 4.0%.
Newton Global Higher Income yes4.7%More Info >
Income Paid Quarterly. The objective of the Sub-Fund is to achieve increasing annual distributions together with long-term capital growth from investing predominantly in global securities. The Sub-Fund may also invest in collective investment schemes. See latest fund factsheet for details.
Jupiter Merlin Income Portfolioyes3.10%More Info >
Income Paid Quarterly. To achieve a high and rising income with some potential for capital growth by investing predominantly in unit trusts, OEICs, Exchange Traded Funds and other collective investment schemes across several management groups. The underlying funds invest in equities, fixed interest stocks, commodities and property, principally in the UK. See latest fund factsheet for details.
M&G Global Dividendyes3.27%More Info >
Income Paid Quarterly. The Fund aims to deliver a dividend yield above the market average, by investing mainly in a range of global equities. The Fund aims to grow distributions over the long-term whilst also maximising total return (the combination of income and growth of capital). See latest fund factsheet for details.
Kames Strategic Bond yes2.95%More Info >
The primary investment objective is to maximise total return (income plus capital ) by investing in global debt instruments,denominated in any currency, ranging from AAA Government Bonds through to high yield and emerging market corporate bonds. At least 50% of the fund will be invested in sterling and other currency denominated bonds hedged back to sterling. See latest fund factsheet for details.
M&G Optimal Incomeyes2.44%More Info >
Income Paid Twice Yearly.The fund aims to provide a total return to investors based on exposure to optimal income streams in investment markets. The fund invests across a broad range of fixed income assets according to where the fund manager identifies value. See latest fund factsheet for details.
*Current Income Yields are Gross, Variable and Not Guaranteed
**Historic Yield reflects distributions declared over the past 12 months as a percentage of the mid-market price of the fund.
*** This is the target yield the fund aims to achieve per year, it is not guaranteed and could change according to prevailing market conditions. The target yield is net of basic rate tax.
Information correct as at 08/02/2012.

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