Where now for corporate bonds

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  • 10 mins 48 secs

Can the strong returns that corporate bond markets have enjoyed so far this year continue? Michael Matthews and Thomas Moore discuss recent developments and what it means for their funds.

They discuss:

  • Drivers of corporate bond market performance
  • Views on the Financial sector
  • The change in demand for BBB-rated credit
  • Positioning of the Invesco Corporate Bond Fund (UK) and the Invesco High Yield Fund (UK).

Invesco Corporate Bond Fund (UK)

Invesco High Yield Fund (UK)

Investment risks

The value of investments and any income will fluctuate (this may partly be the result of exchange rate fluctuations) and investors may not get back the full amount invested.

The securities that the Invesco Corporate Bond Fund (UK) and the Invesco High Yield Fund (UK) invest in may not always make interest and other payments nor is the solvency of the issuers guaranteed. Market conditions, such as a decrease in market liquidity for the securities in which the funds invest, may mean that the funds may not be able to sell those securities at their true value. These risks increase where the funds invest in high yield or lower credit quality bonds and where we use derivatives.

The funds have the ability to make use of financial derivatives (complex instruments) which may result in the funds being leveraged and can result in large fluctuations in the value of the funds. Leverage on certain types of transactions including derivatives may impair the funds’ liquidity, cause them to liquidate positions at unfavourable times or otherwise cause the funds not to achieve their intended objectives. Leverage occurs when the economic exposure created by the use of derivatives is greater than the amount invested resulting in the funds being exposed to a greater loss than the initial investment. The funds may be exposed to counterparty risk should an entity with which the funds do business become insolvent resulting in financial loss.

The funds may invest in contingent convertible bonds which may result in significant risk of capital loss based on certain trigger events. Changes in interest rates will result in fluctuations in the value of the funds.

Important information

Where individuals or the business have expressed opinions, they are based on current market conditions, they may differ from those of other investment professionals and are subject to change without notice.

For the most up to date information on our funds, please refer to the relevant fund and share class-specific Key Investor Information Documents, the Supplementary Information Document, the Annual or Interim Reports and the Prospectus, which are available using the contact details shown.

Issued by Invesco Fund Managers Limited, Perpetual Park, Perpetual Park Drive, Henley-on-Thames, Oxfordshire, RG9 1HH, UK. Authorised and regulated by the Financial Conduct Authority.





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