Quest for Yield Means Making Cash Work Harder

With interest rates continuing to fall, investors are finding it harder to generate positive yield at the low end of the risk spectrum. Portfolio Manager Dan Siluk explains why it’s important for short-duration bond portfolios to consider opportunities outside the U.S. in this environment.

Key Takeaways

  • As central banks continue to lower rates amid economic uncertainty, investors are finding it more and more challenging to generate yield at the low end of the risk spectrum.
  • In this environment, we think it’s necessary for investors to make their cash work harder, as money market funds and bank CDs no longer offer the yields they are seeking.
  • In our view, short-duration bond portfolios should seek opportunities not only in the U.S. but also in global regions where positive real yields can still be found.