2018 Compelling Cash Alternatives - April 2018
Improving The Outcomes For Cash Investors - April 2018
To have a reasonable chance of achieving a better return than a term deposit, investors need exposure to assets with a higher expected return than cash.
In Strategic Income and Global Strategic USD Income this is achieved by taking considered interest rate and credit risk where appropriate (as defined on page 3), and by increasing exposure to alternative sources of return (as defined on page 4), when the likelihood of outperformance is expected to be high. A higher return, however, comes with higher levels of risk. Risk is managed by following a robust and consistent investment process. We apply defensive asset allocation guidelines and conduct careful research to identify individual securities trading below our estimate of fair value. There are, however, no guarantees that the funds will always outperform cash or protect capital over short periods of time.
Our risk objectives in both funds are to protect capital in the reference currency over all periods of 6 months and longer, and to achieve variability of returns that are significantly less than those exhibited by the respective benchmark bond indices.