Bonds – Shaken not stirred? MRM’s weekend paper round-up
Unsurprisingly, the recently-announced end of the recession has not quenched investor appetite in the hunt for income.
Kathryn Cooper’s lead in The Sunday Times flags up the point that bonds, once the natural choice for the safety conscious investor, are falling out of favour with advisers and top fund managers. With MRM client Ignis Asset Management indicating that the forthcoming dividend season could well be one of the strongest on record, and that 60 European companies, including many in the UK, have dividend yields that are higher than their bond yields, could the humble equity income fund be next in the spotlight for income-seeking investors?
The FTWeekend appears to think so, with Ellen Kelleher advising investors to sell gilts now that QE has come to an end and Alice Ross extolling the virtues of equity income funds, with equity income trusts now trading on an average discount of 6% following their fall from grace in last year’s bull market. MRM will be keeping a close eye on developments in this debate over the coming months…
Sticking with the bond theme (insert theme song of choice here), the LSE’s retail bond market launch this week received mixed reviews in the weekend press. While the Sunday Telegraph’s Paul Farrow praised the initiative, calling it ‘a step towards equal rights for smaller investors’, the Mail on Sunday’s Richard Dyson describes the scheme as a ‘flop’, with ‘only’ 10 corporate bonds currently available to investors.
Meanwhile, elsewhere in the weekend’s Money pages, some cautious words of advice were offered by the Guardian in light of the OFT’s ‘scamnesty’ campaign launched this week (most notably in relation to the lack of FSA regulation for those advisory firms describing themselves as ‘membership organisations’), and on a similar note the Independent’s Simon Read warns that the Facebook and Twitter-happy among you may be vulnerable to fraudsters.
MRM wishes you a Tweet-safe week!
Weekend coverage ‘scores on the doors’ as below…
Charity: 2%
Credit cards: 2%
Fraud/scams: 7%
IFAs: 2%
Insurance: 7%
Investment: 38%
Mortgages: 7%
Pensions: 7%
Regulation: 0%
Savings: 18%
Tax: 3%
Utilities: 8%