Market insights

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The drawbacks of globalisation are prompting companies to bring their production closer to customers again, while countries are seeking to become less dependent on expensive energy imports. This creates opportunities for investors.

We are seeing a number of attractive opportunities within high-quality corporate bonds after this year’s significant correction. Here, in contrast to equities, for example, the worst is likely already over.

Fundamentally, high-yield issuers are in a solid position and could well live with a potential moderate recession. The substantial correction we have seen so far in 2022 would therefore constitute an interesting entry point for long-term investors.

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Against a background of persistent uncertainty and a combination of higher interest rates and bond yields with inflation set to fall in the medium term, an environment is emerging in which diversification should once again pay off.

Investing in euro-denominated bonds versus USD bonds with a similar profile from the same issuer offers an attractive opportunity to generate additional returns over the medium term without increasing risk.