Trending towards Multi Sector Credit

Joseph Portera. CIO, High Yield and Multi-Sector Credit, and Invesco Multi-Sector Credit Team.

The challenges of the current low interest-rate environment require different approaches and disciplines than were necessary in the strong bull market for bonds of the past two decades. Multi-sector credit can be an efficient and unique approach to global credit investing.

By leveraging the global opportunity set and overlaying risk management to minimise drawdowns, this segment can help to achieve an appropriate risk-adjusted return.

Invesco Fixed Income’s multi-sector credit strategies continue to attract growing attention from those investors looking to boost their fixed income allocations’ diversification, yield and risk-adjusted return potential.

These actively managed strategies offer a dynamic allocation mix across global credit segments that can be continuously adapted in an effort to optimize overall positioning and security selection as market conditions and investment opportunities evolve.

This paper discusses the reasons why, in our view, the multi-sector credit segment has become an increasingly popular choice for so many investors and offers an overview of the distinct characteristics and potential benefits of the Invesco Active Multi-Sector Credit strategy. It also highlights various portfolio applications for effective implementation.

Download the quarterly Multi-Sector Asset Allocation Outlook.

Read our articles below or download the full paper to find out more.

  • The value of investments and any income will fluctuate (this may partly be the result of exchange-rate fluctuations) and investors may not get back the full amount invested.

    As a large portion of the strategy is invested in less developed countries, you should be prepared to accept significantly large fluctuations in value.

    The strategy will invest in derivatives (complex instruments) which will result in leverage and may result in large fluctuations in value.

    Debt instruments are exposed to credit risk which is the ability of the borrower to repay the interest and capital on the redemption date. Investments in debt instruments which are of lower credit quality may result in large fluctuations in value. Changes in interest rates will result in fluctuations in value.

    The strategy may invest in distressed securities which carry a significant risk of capital loss.

    The strategy may hold a large amount of Asset Backed Securities (ABS) (complex instruments) as well as lower quality debt securities which may impact liquidity under certain circumstances.

    Performance may be adversely affected by variations in the exchange rates between the base currency of a portfolio and the currencies in which the investments are made.

  • Data as at 30.09.2020, unless otherwise stated. This document is marketing material and is not intended as a recommendation to invest in any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. The information provided is for illustrative purposes only, it should not be relied upon as recommendations to buy or sell securities.

    Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice. Further information on our products is available using the contact details shown. Past performance is not a guide to future returns. Forecasts are not reliable indicators of future performance.