Generating yield with non-traditional asset classes

To generate income in this era, investors must look toward new types of investments that fall between traditional bonds and equities. Some of the options include corporate and high-yield bonds, floating-rate loans, dividend-paying stocks and listed infrastructure.

Need to break the ice with clients about diversifying their portfolio away from traditional fixed income? Try these conversation starters.

Floating Rate Loans (protection from rising interest rates)

• Today’s interest rates could be the biggest risk or biggest opportunity.
• Interest rates are rising. We believe opportunities are too.
• Sometimes the best offense is a good defence. With interest rates poised to rise, new asset classes such as floating rate loans can help you get ahead of the interest rate cycle.
• The changing realities of the bond market may require some rethinking.
• Your ‘sleep well at night’ money in fixed-income could be at risk in the current environment. But challenges also present opportunities.

Infrastructure (add stability and income to portfolios)

• Even when times are tough, people still use water, gas, electricity and roads to get to work.
• Invest in assets the world relies on.
• Infrastructure is often described as the backbone of the global economy.
• The world’s insatiable demand for infrastructure can create some lucrative investment opportunities.
• Investment in infrastructure is currently considered as a key policy objective of most developed and developing nations.