UK - Pension funds should take advantage of any prolonged period of low growth and inflation to buy bonds, urges Schroders.
The fund manager recommends single-A or triple-B corporate bonds yielding around 6% as the best investment, in a world where government bond yields have plunged to below 4%.
In addition, it advises investors to look at foreign bonds – with European bonds particularly attractive at the moment.
Schroders global head of fixed income Bob Michele said: “As the global economy continues through a prolonged period of low growth and low overall inflation, bonds are a good asset to buy.
“Equally as important as deciding to buy bonds is determining which are the best type of bonds to purchase.
“At the moment we are recommending a mix of corporate bonds which look very cheap or foreign bonds hedged back to sterling.”
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