Standing up to market challenges
24 minute listen
David Smith, Portfolio Manager of Henderson High Income Trust, discusses the factors currently affecting the UK market, navigating concentration risk, and how consumers and businesses are dealing with rising costs. David also highlights why bonds are essential for diversification and provides his outlook for UK dividends.
- Despite the increased volatility in global equity markets, the UK market has been fairly resilient largely supported by solid performance from the mining and oil & gas sectors which have benefitted from surging commodity prices.
- Our ability to own bonds was beneficial from a diversification perspective since bond coupons are typically more resilient compared to equity dividends in big drawdowns or economic recessions. Though our bond exposure has been near historic lows, we’ve started allocating away from equities and into bonds.
- With consumers under pressure from the cost-of-living crisis, businesses that have set up their operations to be the low-cost leader can provide consumers with good value for money and could stand to benefit in this difficult market environment.
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These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. Any securities, funds, sectors and indices mentioned within this article do not constitute or form part of any offer or solicitation to buy or sell them.
Past performance does not predict future returns. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.
The information in this article does not qualify as an investment recommendation.