The attitude of investors towards convertible bonds is becoming more positive, according to Andrew Hope, head of convertible bond research at investment bank Jeffries.
Hope said that although investors initially preferred the higher risk of equities during the bull market, then becoming fearful of their equity exposure, the time may be approaching when a more balanced approach will become commonplace.
“As we approach a period when, for the first time in a decade, the mood of investors is precisely attuned to the risk profile of convertible bonds, it is useful to point to some recent performance numbers to demonstrate that convertibles do indeed deliver what is expected of them.”
Up until April 20, he said, global equities, as represented by the MSCI World index, had declined 4.1% in Swiss Francs. Global bonds, as represented by the JP Morgan Global Government Bond index, had risen 3.0%. Global convertible bonds, as represented by JACI Global, had risen 2.5% .
Hope added that convertibles have managed almost to match the performance of global bonds even during a period of declining equity markets.
By Janet Du Chenne
Former home secretary Amber Rudd is to return to the cabinet as work and pensions secretary after the resignation of Esther McVey.
This week's top stories included proposed draft regulations in a no-deal Brexit which would make scheme investments illegal, and Esther McVey's resignation as secretary of state.
There have been a total of 15 ministers responsible for pensions since 1997. Here is the list in full.