Tailor-made solutions for individual problems
After more than a decade of low and negative yields, bonds are trading at more reasonable and positive levels following the sharp rise in 2022. In many investment-grade segments, especially non-financial and financial bonds, euro bonds are again offering yields of 3% and more.
This opens up the possibility for investors to act more strategically again, away from traditional benchmark-oriented investment approaches, which tend to be more trading intensive, and to rely more on individual bond strategies. This is because the focus is no longer on avoiding negative interest rates and penalty charges, but rather on ordinary income, individual problems and tailor-made solutions.
In this Insights publication we present three individual approaches:
- target maturity portfolios;
- ladder structure portfolios; and
- payout-oriented bond portfolios.
We discuss possible applications as well as advantages and disadvantages.
Felix Stern joined the Asset Management division of Berenberg in 2000 as a fixed income portfolio manager. Currently he is heading the fixed income selection team within the Asset Management and is responsible for institutional mandates. As a senior portfolio manager he is responsible for the selection of corporate and financial bonds as well as short-term bond market investments. He is also the lead manager for several of Berenbergs institutional mutual funds. Prior to joining Berenberg, he worked several years for the Market Research department of British American Tobacco, Germany. Felix is a CCrA - Certified Credit Analyst (DVFA) and also has a German Diploma in business economics from the Fernuniversität in Hagen.
Dr. Florian Urbschat
Dr Florian Urbschat joined the Fixed Income Euro team in October 2022 and focuses on the development of interest rates. After studying economics in Bachelor and Master at the University of Hamburg with internships and a master's thesis at the Deutsche Bundesbank, he earned his PhD in economics at the LMU Munich, worked as a guest researcher at the Bundesbank and was subsequently a PhD trainee at the European Central Bank. In 2019, Mr Urbschat switched to the asset management sector and joined Allianz Global Investors as a fixed income portfolio manager.