Why You Should Stick with "Boring" Bonds

The temptation to invest in riskier assets to generate a higher yield is understandable, but investors should avoid anything yielding more than 5% says Janus Hendersons' John Pattullo

Annalisa Esposito 3 February, 2020 | 9:46AM

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After more than a decade of ultra-low interest rates, the temptation to turn to riskier assets to generate an income is understandable. The coupon on many government and corporate bonds fails to beat inflation, or even generates a negative real return in some instances. But while there are options to earn a higher yield, these often come with much more risk. 

John Pattullo, manager of the Silver-Rated Janus Henderson Strategic Bond fund, says investors should be wary of any bond offering a yield of more than 5%.

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About Author

Annalisa Esposito  is a data journalist for Morningstar.co.uk

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