Education

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As the stock market euphoria fizzles and global trade rhetoric takes centre stage, convertible bonds are quietly making their comeback as a top-performing, resilient asset class. In our new report, we go about debunking some of the most common myths about the CB asset class, while also presenting the current investment case.

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Convertible bonds are a combination of equities and bonds and possess various highly attractive characteristics. A fundamental feature of convertibles is that they offer high, equity-like upside potential while strongly limiting downside risk.

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Volatility is back hitting the stock markets, and convertible bonds once again provide investors with an interesting alternative to be more resilient, while remaining invested in growth. Additionally, they offer access to megatrends such as AI and healthcare spending.

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The traditional 60/40 allocation between equities and bonds remains widely popular. However, with a few tweaks, namely adding a moderate allocation to convertible bonds, this trusty staple of the asset management world can yield superior results without losing any of its advantages.

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