108. How to make money when everyone else is losing it

Mike Riddell and Kacper Brezniak tell us why they believe most strategic bond funds behave like equities. They talk us through how the fund actually managed to make money during the market falls earlier this year, tell us why they like emerging market debt and emerging market currencies, and explain how negative yields on Japanese bonds can turn positive for sterling investors.
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The positioning of Allianz Strategic Bond fund is driven by the team’s macroeconomic view. Mike believes most strategic bond funds have a high correlation with equities and has designed this fund to be very different. He is not afraid to radically alter the positioning of the portfolio quickly and this flexibility allowed him to delivering spectacular results during the coronavirus crisis.

Read more about Allianz Strategic Bond

What’s covered in this podcast:

• Why the manager thinks most strategic bond funds are like equities [0:33]
• How the manager went about designing this fund [1:42]
• How the fund managed to make money in February and March when everything lost money [4:59]
• How the fund also managed to do well when markets recovered [7:07]
• What changes the managers have made since the summer [10:07]
• Why the managers like emerging market debt [10:40]
• How negative Japanese bond yields can turn positive for sterling investors [13:31]
• Why the fund’s yield moves up and down [14:30]
• Why investors should consider bond funds for diversification, not income [15:30]

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