Invest in
fixed income
Earn regular income with fixed income funds, investing in a mix of government and corporate bonds with up to 8% p.a. income distribution on ADDX.
Steady income from diversified bonds
Fixed income refers to investments that generate regular interest payments over a specified period, with the principal typically returned at maturity. Public fixed income funds invest in bonds issued by governments, government agencies, and corporations. These can include sovereign bonds, investment-grade corporate bonds, and high-yield bonds, each with their own risk-return profiles.
Who might consider fixed income?
Fixed income may appeal to investors seeking predictable income and a way to balance portfolio risk. These investments can help provide stability in a diversified portfolio, as they often show lower volatility than equities. While fixed income can offer steady cash flow, investors should consider interest rate risk, credit risk, and inflation risk. A thorough review of the fund’s holdings, duration, and risk factors is recommended before investing.
Fixed income investments typically provide regular interest payments, making them attractive for investors seeking consistent cash flow.
Fixed income investments typically provide regular interest payments, making them attractive for investors seeking consistent cash flow.
Fixed income offers diversification benefits, helping to smooth portfolio returns since bonds often react differently to economic and market shifts than equities.
From government bonds with lower yields and risk, to high-yield corporate bonds with higher potential returns and risk, fixed income offers varied choices to suit different investor profiles.
Public fixed income securities are generally more liquid than private debt, allowing for easier entry and exit compared to illiquid/semi-liquid alternatives.
Key risks to keep in mind
Interest rate risk
Bond prices generally fall when interest rates rise, which can impact returns if securities are sold before maturity.
Credit risk
Issuers may default on interest or principal payments, leading to potential losses.
Inflation risk
Rising inflation can erode the purchasing power of interest payments
Market risk
Broader economic and market conditions can influence bond prices and yields.
FAQs
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