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Bonds & Fixed Income

What is fixed income investing?

Fixed income is an investment approach focused on preservation of capital and income. It typically includes investments like government and corporate bonds, CDs and money market funds. Fixed income can offer a steady stream of income with less risk than stocks.

Global fixed income marketplace

Fixed Income Securities now amount to a vast global marketplace that provides a variety of important benefits to investors

We live in a world of rapidly-changing financial market dynamics. Evolving economic expectations and interest rate assumptions combine with an unfolding geopolitical backdrop to lend support to the idea of investing in a well-diversified portfolio.

Fixed income can be mixed with riskier asset classes such as equities to help generate superior risk-adjusted returns. Meanwhile, against a background of ageing populations in many developed markets, the demand for income continues to exert its influence as a powerful and positive force. This will continue to provide support for fixed income as an asset class going forward.

Across the range of fixed income markets can be found a wide array of risk and return characteristics. The attraction of each area can change as economic and credit cycles progress. ASW pursue a flexible and dynamic allocation approach that enable us to seize investment opportunities as they arise – while minimising downside risks.

Why ASW for global fixed income

Breadth and depth of expertise across fixed income markets, serving a diverse client base

Why an active approach?

We think an active investment approach is more likely to provide a better return over the long term than a passive solution and to help you achieve your investment objectives. 

Fixed income markets can be complex and the long-running expertise of our specialist investment managers means they may be able to uncover opportunities that others might miss, whilst protecting capital when needed.

Our approach to fixed income

Fixed income is a core strength for our firm and we offer a wide range of strategies including global, regional and emerging markets, corporate debt, and money market funds. We also offer more specialist strategies such as absolute return and hedge funds.

“Our priority is ensuring that each one of our independent fixed income teams focuses only on investing, while benefiting from the support of our wider platform.”

Investing for a better future

Sustainability has long been central to our company, which is why we are at the forefront of our industry in incorporating environmental, social and governance (ESG) criteria into all our investment processes – not least for our fixed income strategies.

Integrate ESG factors into all investments processes

Engage with companies and goverments

Exercise voting rights

Act as stewards of responsible investing

Be transparent with clients on EGS criteria

What are the risks?

As with any other investment, investing in fixed income carries risks. It’s therefore important to find an experienced manager to manage these.

Investments in fixed income may be subject to the default/credit risk of issuers, interest rate risk as bond prices move inversely to changes in interest rates, and liquidity risk. Investing in higher-yielding or non-investment grade bonds might mean the risk of the issuer defaulting on the capital repayment is higher.

These strategies could also invest in emerging markets, where investments can be higher risk and more volatile, or denominated in a foreign currency meaning a change in exchange rates could affect their value. They may also use derivatives which carry similar risks, or use leverage. Investments are subject to the risk of material losses resulting from human error, systems failures or the incorrect valuation of the underlying securities.

Past performance is not a guide to future performance. The value and income of an investment can fall as well as rise and you may not get back the amount originally invested.

Ways to invest

Emerging Market Bonds

We believe that the fast-growing economies of emerging markets offer investors the potential for sustainable, long-term returns, particularly via their large sovereign and corporate debt markets.

We offer multiple ways to access emerging market bonds:

Global
Provides access to some of the world's fastest growing economies from a potential investment universe of 60+ emerging market countries. This broad approach provides wide-ranging investment opportunities whilst spreading potential risks. 

Hard currency 

Provides exposure to emerging market bonds without taking on currency risk. This is the most established emerging market debt asset class, comprised of sovereign and corporate bonds issued in major currencies such as US dollars or Euros. 

Local currency

Provides exposure to emerging market bonds without taking on currency risk. This is the most established emerging market debt asset class, comprised of sovereign and corporate bonds issued in major currencies such as US dollars or Euros. 

Corporates

Provides access to the fast-growing opportunity in emerging market corporate bonds, denominated in major currencies such as US dollars or Euros. 

Short-term

Invests in either corporate or sovereign debt and offers a degree of protection from rising rates by focusing on securities with a short duration. Seeks to provide stable and attractive income with limited volatility.

Sustainable blend

Provides diversified emerging market debt exposure with a focus on ESG factors. As a blended approach, it combines our best ideas from both emerging market hard and local currency bonds. 

Regional

Bond strategies which focus on regions such as Asia, China, and Latin America, and which seek to capture the vast range of opportunities available in these dynamic markets through a combination of our local expertise and broad research capabilities.

Developed Credit

Developed markets offer a vast pool of investible debt securities across both governments and corporates. We offer a wide range of strategies for investors to suit their investment objectives and risk appetite. Our strategies invest across a range of assets, from the lower-yielding bonds issued by high-quality companies and governments to the higher-yielding bonds issued by lower-rated companies. We offer strategies in a range of developed market currencies such as US dollars or Euros.

Absolute Return

Absolute return fixed income
Traditional fixed income strategies seek to provide a relative return in excess of a benchmark index. ASW Absolute Return Fixed Income and ASW Global Fixed Income Opportunities, on the other hand, are unconstrained by benchmarks and so can invest wherever our managers see the best opportunities. Each has a different risk-return profile designed to meet different investor needs, and we place particular emphasis on liquidity and reducing volatility.

Fixed Income Hedge Funds

With our strong experience in both fixed income and hedge funds, combining the two and expanding our investment offering to fixed income hedge funds was a natural progression. We offer the following:

Global credit hedge fund
Investors who want to protect against a market correction in the current low-yield, high-valuation environment might consider a global credit hedge fund strategy. The strategy can act defensively by allocating less when assets are expensive, and can extract the relative value from taking long/short positions in credit. 

Global macro emerging markets fixed income

The case for investing in emerging markets is clear, but emerging market assets are too often subject to volatility – emerging stocks, bonds and currencies can all experience bouts of turbulence. ASW offers a solution which provide access to these assets for investors, but with lower volatility. The strategy aims to generate a positive risk-adjusted return in all market conditions by the use of long/short positions, as well as the ability to invest in a broad selection of assets.

Capital preservation

Capital preservation means protecting the absolute value of your investment via assets that promise return of principal. Because bonds typically carry less risk than stocks, these assets can be a good choice for clients with less time to recoup losses.

Explore our fixed income offerings to learn how we can help you build a bond portfolio that meets your needs. Speak with your advisor today to see how our fixed income options can help you beat the markets today.

Our experts

New York

Bonds & Fixed Income

ASW

+1 332 205 6058

info@alpha-sw.com