This Ugly-Duckling Asset Is Looking A Lot More Like A Swan

Russell Burns

about 2 months ago4:04 mins

This Ugly-Duckling Asset Is Looking A Lot More Like A Swan

Major investment banks and fund managers say there’s one asset that’s starting to look more attractive than the rest. And recent ETF buying activity shows that retail investors are beginning to come to the same conclusion. And here’s the thing: with so many investors still ignoring this long-shunned asset, you can still buy it at some pretty good prices.

What’s this attractive asset?

Morgan Stanley, which spent much of the year favoring cash, now says high-grade corporate bonds, currently yielding 5%-7% across maturities, will outperform global equities, at least through the first quarter of 2023. And retail investors appear to agree: they moved $16 billion into US corporate bond ETFs in the first 23 days of this month, the most since July 2020, according to fund-flow tracker EPFR.

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