In the press: AFR - Rich variety of bonds lighting up innovative pathways

In the press: AFR – Rich variety of bonds lighting up innovative pathways

In case you missed it, Pete was quoted in an article in the Australian Financial Review (AFR).

The title was “Rich variety of bonds lighting up innovative pathways” and fixed interest ETF’s and some important considerations for retail investors. A few of the details referencing Pete are below, and you can check out the full article here.

 

 

…given how diverse the investment universe is among bond ETFs now, it’s essential to really understand the investment.

“The risk/return profile can vary substantially across fixed interest ETFs. So, you must be clear on what you want your investment in a fixed interest ETF to do for your portfolio and then do your homework on what option is the best fit for you.

“Don’t be seduced by the fixed interest ETF that had the best performance last year. Also, don’t equate them to term deposit as there is more risk involved with a bond ETF,” says Pennicott.

The balance between active and passive ETFs in a fund is an important consideration, says Zenith Investment Partners’ head of real assets and listed strategies, Dugald Higgins. Photo: Tash Sorensen

“Be mindful the ETF’s name doesn’t always tell the whole story. But terms such as high yield, unconstrained, emerging and hybrid should make clear the need to get familiar with the detail of the investment strategy. Buyer beware, as fixed interest can also be risky. Research is critical.”

Go to the product disclosure statement if you don’t know where to start as this contains all the ETF’s important details, he says. “Historical returns may also prove helpful in narrowing the options, as one of the foundation rules of investing is higher returns indicate more risk,” he adds.