Time to rebalance

Although equities have received a great deal of attention in recent weeks, as investors start to look towards more riskier asset classes, the credit market could offer an even better investment

During the recent crisis, investors fled for the safety of prime money-market funds and developed government bond markets. However, with money-market investments now generating meagre returns, cash is gradually being redeployed in riskier assets. Some institutional investors are considering shifting their allocations to equities to re-attain the equity exposure they would normally target (that exposure having declined because of the drop in equity valuations). However, corporate debt currently offers a compelling investment opportunity, even compared to stocks, once relative risks are...