This is not substantive investment research or a research recommendation, as it does not constitute substantive research or analysis. This material should be considered as general market commentary.
Bonds have traditionally been sought after for certain characteristics: lower volatility, diversification versus equities and steady annual returns through income. In recent years investors have sought to diversify as these attractions have become less reliable. Increasing amounts of capital have flowed into the infrastructure and renewable infrastructure sectors for reasons we discussed in a recent strategy note. However, there is an alternative closer to home which could offer many of the same attractions. In the past few years, a handful of trusts have started to open up the private debt space from its historically institutional ownership to a broader investor base. Here we try to demystify this asset class and show how it could be made for the current economic environment.
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