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Market Tactics

Video: Fixed Income ETFs offer liquid exposure to the bond market

06 April 2016

In this week's Market Tactics video, we discuss how retail and professional investors are using fixed income ETFs for core and tactical exposure to bond markets

Many bond strategies can now be replicated using exchange traded funds (ETFs) and in Europe alone €120bn is invested in fixed income this way. Portfolio managers are using the products for core bond exposure; as a diversification tool (to gain simple access to corporate or international sovereign debt); and also as a tactical tool, to swiftly alter bond allocations in response to macro events, such as European Central Bank (ECB) policy announcements. Another reason for the growth in fixed income ETFs, is that some money managers believe the secondary market in the funds themselves adds an additional layer of liquidity.

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