Animal Spirits Podcast Talk Your Book: Interest Rates Go Kablooey
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Apr 21, 2025 In this engaging conversation, Jason Greenblath, VP at American Century Investments, shares insights on navigating short-duration fixed income amidst economic volatility. He discusses strategies for remaining active during recessions and managing inflationary spikes. Christian Hoffmann, Head of Fixed Income at Thornburg Investment Management, dives into global credit market opportunities and the implications of heightened volatility. They explore the challenges posed by rising interest rates and the shifting dynamics of investment risk in today's financial landscape.
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Short Duration Fixed Income Appeal
- Short duration fixed income is attractive amidst inflation uncertainty and economic shifts.
- Global inflation trends and tariff impacts justify anchoring portfolios in the short end of the yield curve.
Lock In Yields With Active Management
- Invest in short duration fixed income between two to four years to lock in attractive yields and manage interest rate risk.
- Use active management to select securities and allocation to enhance returns beyond passive index exposure.
Credit Risk Focus in Short Duration
- Credit quality is crucial in short duration fixed income to avoid defaults and preserve capital.
- A bottoms-up credit analysis coupled with stress testing helps manage risks amid recession uncertainties.