Brad Dunn, senior credit analyst at Daintree Capital, joins Owen Rask for a deep-dive into the inner workings of the global credit market.

If you’re worried about high inflation, the impact of interest rates on bond and stock markets, or simply what goes into professional credit investing, this is the episode for you.

Talking points
– Credit analyst v equities analyst
– Why don’t more investors invest *directly* in credit?
– What is duration and why is it important?
– Brad’s overview of fixed income markets
– Inverted yield curves and why they matter
– Active versus passive exposure to fixed income
– Filtering the bond market & how Brad finds bonds to buy
– Inside Daintree’s core & overlay strategy, including duration, spread compression, value adding and more
– Brad’s view on inflation & the impact of consistent inflation on stocks & bonds in 2022
– How to build a fixed income portfolio in a high rate environment
– ESG investing in the bond market

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Full individual disclosures for each guest are available via the show notes page. Owen and The Rask Group Pty Ltd do NOT receive anything for mentioning Super funds, products, shares, bank accounts, etc.

DISCLAIMER: This podcast contains general financial information only. That means the information does not take into account your objectives, financial situation, or needs. Because of that, you should consider if the information is appropriate to you and your needs, before acting on it. If you’re confused about what that means or what your needs are, you should always consult a licensed and trusted financial planner. Unfortunately, we cannot guarantee the accuracy of the information in this podcast, including any financial, taxation, and/or legal information. Remember, past performance is not a reliable indicator of future performance. The Rask Group is NOT a qualified tax accountant, financial (tax) adviser, or financial adviser.

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Date recorded: 14th December 2021…(read more)

LEARN ABOUT: Investing During Inflation

REVEALED: Best Investment During Inflation

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As an investor, it’s important to be knowledgeable about different types of investments, particularly as inflation rises. One investment strategy that can help mitigate the effects of inflation is fixed income investing.

In this guide, we’ll explore fixed income investments, their benefits, and how to invest in them during times of high inflation.

What are Fixed Income Investments?

Fixed income investments, also known as bonds, are debt securities issued by entities looking to raise capital. These entities could be governments, corporations, municipalities, or other organizations. When an investor buys a bond, they are essentially lending money to the issuer, who promises to pay back the principal amount plus interest at a fixed rate over a set period of time.

Benefits of Fixed Income Investments

There are several benefits to investing in fixed income investments. One of the main advantages is the security that comes with these investments. Unlike stocks, bonds have a fixed rate of return and a set maturity date, making them less volatile and more predictable. This makes them a more reliable source of income, even when inflation is high.

Additionally, fixed income investments tend to offer higher yields than savings accounts or CDs. This makes them an attractive option for those looking to generate a steady stream of income without having to worry about market volatility.

Investing in Fixed Income During High Inflation

Inflation erodes the value of money over time. This means that if inflation is high, the value of a fixed income investment may decrease. However, there are several fixed income investments that can help investors protect their portfolio against inflation.

One option is Treasury Inflation-Protected Securities (TIPS). TIPS are issued by the US government and are designed to protect investors against inflation. They work by providing a fixed interest rate plus an adjustment for inflation, which helps ensure that the investor’s purchasing power is maintained.

Another option is corporate inflation-linked bonds. These bonds are issued by corporations and provide a fixed rate of return plus an inflation adjustment. Like TIPS, they are designed to help protect investors against inflation.

Conclusion

Fixed income investments are a valuable tool for investors looking to generate a steady stream of income while mitigating the effects of inflation. By investing in fixed income products such as TIPS or corporate inflation-linked bonds, investors can help ensure that their portfolio remains protected against inflation.

While fixed income investments may not offer the same potential for capital appreciation as stocks, they do offer a reliable source of income that can help keep inflation at bay. As with any investment, it’s important to do your research and consult with a financial advisor to determine if fixed income investments are right for you.