While investors should be wary of the market's ability to absorb future outflows, certain funds remain worthy of strong consideration. City Financial's Anthony McDonald explains.
At the end of 2013, corporate bonds offered a distribution yield of 3.6%, using the Vanguard UK Investment Grade Bond index fund as a proxy for the asset class. This historically low yield level is, of course, the result of the rock-bottom interest rates that have now been in place for over five years. With limited returns available from cash and, subsequently, government bonds, the gradual healing of the economy and strong investment demand have allowed corporate bonds to enjoy a strong rally since the start of 2009. The asset class has delivered strong absolute performance of almost...
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