Global government bond levels are a risk to portfolios - so why hold them?

Brendan de Jongh, SA head of research at PortfolioMetrix, explains the benefits of holding an asset class when the risks have increased and yields have declined.

The precipitous fall in global government bond yields has serious implications for asset prices globally. This can be seen as one of the biggest risks to all asset classes and hence investors' portfolios. So should investors be concerned? It is important to note that low yields are a global phenomenon and are not confined only to those countries where central banks are experimenting with asset purchases. Yields are low because of a low growth and low inflation environment globally as well as a shortage of safe haven assets, which is not expected to change anytime soon. Inflationary...