Multi-Asset

Investing for income in a lower growth world

02/01/2012

Overview

  • The weak economic backdrop suggests that in the future investors will be less able to rely on capital growth and that exposure to growth assets may come with an even greater level of downside risk.
  • Reduced yields have put significant pressure on savers and retirees who often rely on their investment income to support their standard of living.
  • In the search for income investors have to take on more risk but relying on single asset classes for this yield can lead to a more variable outcome.
  • A global multi-asset approach that seeks out sustainable income from a range of asset classes can provide an income solution even in this low rate environment.
  • A focus on both income and quality has historically delivered an attractive total return.
  • The ability to manage downside risk will be critical to protect the portfolio from capital erosion.
  • These conditions create a potential opportunity to profit from income as a theme even for those investors who do not require cash distributions.

The views and opinions contained herein are those of Schroders’ investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.’s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.