IT'S TIME TO RETHINK YOUR FIXED INCOME WITH iSHARES ETFs

There's a bigger role for fixed income ETFs in today's portfolios

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WHY IT’S TIME TO RETHINK FIXED INCOME WITH ETFs

  • Market volatility has tested investors’ portfolios

    Compelling many to rethink their fixed income allocations.
  • Investors are focusing on investment outcomes

    More investors are using bond ETFs to build portfolios that may better meet investment objectives and avoid unwanted risks.*
  • Fixed income ETFs are built for these times

    They are used as efficient, diversified building blocks which provide greater transparency over portfolio risks, enabling Investors to stay nimble with investment implementation.

A NEW ERA OF FIXED INCOME INVESTING

Fixed income investors are facing new market realties, as the global economy is moving away from a period of steady growth, stable inflation and supportive central banks. Instead, we are braving a new world of heightened macro volatility, expectations of higher inflation and tighter monetary policies signaling the end of the great period of monetary easing and announcing multiple interest rates rises in the near future.

What is clear is that the role of fixed income needs to evolve. Investors may consider incorporating new implementation approaches to address the new markets challenges and make their fixed income allocations work harder in their portfolios.

Fixed income yields are looking attractive

Source: Bloomberg, as of 15 December 2022. Index performance are for illustrative purpose only. Investors cannot directly invest into an index. Index performance does not reflect any management fees, transaction costs or expenses. Past performance does not guarantee future results.

IT’S TIME TO FOCUS ON BETTER PORTFOLIO OUTCOMES

More and more investors are taking a holistic portfolio construction approach, blending indexing and alpha-seeking strategies rather than defaulting to one or the other, fully utilising all the “tools in the toolbox” for their intended investment goals.
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Sources: BlackRock (as of March, 2022.) This figure is for illustration purposes only. There can be no assurance that an active trading market for shares of an ETF will develop or be maintained.

A GREATER ROLE FOR FIXED INCOME ETFs IN PORTFOLIOS

We see more investors using fixed income ETFs to address portfolio challenges.

Indexing has the power to transform the fragmented bond market into standardised, predictable and efficient exposures and greatly simplify portfolio construction. Indexing could lower overall portfolio costs, improve transparency to help control and manage risks and minimise the need to monitor and review managers.

INVESTORS’ TOP 3 FIXED INCOME CHALLENGES: RETHINKING OUTDATED APPROACHES HAS COME WITH NEW CHALLENGES FOR INVESTORS

  1. PORTFOLIO CONSTRUCTION: Accelerated macro and structural trends have changed the investment environment. Investors need to take a holistic view to build efficient portfolios and take a flexible, nimble asset allocation approach.
  2. PRODUCT SELECTION: Building real portfolio resilience today requires a broader range of tools and implementation ideas. Investors need a more granular approach to fixed income allocations while also ensuring diversification and liquidity.
  3. SUSTAINABLE TRANSITION: The transition is happening driven by the tidal wave of new regulations and evolving consumer and investor preference. Many investors are now seeking efficient building blocks to transition to more sustainable fixed income portfolios.

EXPLORE MORE

WHY iSHARES FOR FIXED INCOME ETFs?

People

Expertise

iShares pioneered the first Fixed Income ETF in 2002 and is the world’s largest fixed income ETF provider.1
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Wide range of solutions

With the world’s largest range of Fixed Income ETFs, iShares offers solutions to maximise portfolio potential.2
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Quality assurance

iShares ETFs perform as designed and have delivered strong market performance, even in times of volatility.3