Contrarian Investor: What value can we place on infrastructure funds?

NAVs not 'toppy'

Infrastructure as an asset class has some claim to being the most successful alternative investment idea of the past two decades, writes David Stevenson.

While other 'alternatives' have fallen away in popularity, the whole broad spectrum of infra funds, including core PPP/PFI outfits through to renewables funds and healthcare specialists, has continued to boom. This success is, in large part, a product of deliberate government design. But perhaps the most important driver for this success has been the subtlest - low interest rates courtesy of quantitative easing. If UK 10-year bonds are yielding just 1.52%, then why not move a little further up the risk curve and embrace those 4.5% to 5.5% infrastructure yields, safe in the knowledge t...