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Addressing Challenges with Solutions

A Multi-Sector Approach to U.S. Fixed Income

Charles Melchreit

Expanding the investable universe opens opportunities to add income versus basic index-focused strategies. This approach could help deliver higher income but also dampen overall volatility through lower correlations to traditional index sectors, thereby mitigating incremental risk.

 

Pioneer Funds - Strategic Income
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Pioneer Funds - U.S. Dollar Aggregate Bond
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Pioneer Funds - U.S. Dollar Short-Term
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Unconstrained Opportunities in Euro Fixed Income

Mauro Ratto

Discover the importance of searching for value across different sectors, geographies and credit ratings in order to actively seek out investment opportunities. 

A portfolio can benefit from Pioneer Investments' asset allocation and security selection skills, and how the team's bottom-up research, timely asset allocation, and well diversified credit exposure may offer investors a significant opportunity to grow their capital.

 

Pioneer Funds - Euro Strategic Bond
Morningstar RatingTM

Seeking Diversified Income from Multi-Assets

Thomas Kruse

Amid lower-for-longer yields and high volatility in Equities, investors are looking past traditional asset classes to new and diversified sources of income. Pioneer Funds - Global Multi-Asset Target Income targets sustainable income at low volatility through a benchmark agnostic and flexible asset allocation approach.

 

Pioneer Funds - Global Multi-Asset Target Income
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Income Overlay in Equity

Piergaetano Iaccarino

Equity Target Income portfolios seek to provide a high level of income with some market participation, by combining Equity portfolios with an option overlay. Sustainability of dividend yield - identifiying companies which can deliver earnings growth enabling them to maintain and grow dividends, providing investors with the potential for a longer term income stream - is particularly important.

 

Pioneer Funds - European Equity Target Income
Morningstar RatingTM
 
Pioneer Funds - Global Equity Target Income
 
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Investment Experts
Video Interview

challenge-4-thomas-kruse

Charles Melchreit - Director of Investment Grade Management

Mauro Ratto - Head of Emerging Markets

Thomas Kruse - Head of Risk Overlay and Income Strategies

Overview

If there is one investor need that will continue to dominate in the future, it is the need for income. An ageing population and the need to reduce the high level of debt in Developed Markets could result in potential cuts in public welfare and consequently increase the need for income in retirement.

 

Demand for income is also highly relevant in the institutional space. As a consequence of increased regulatory requirements, insurance and pensions funds have been forced to reduce the risk of their portfolios. This all comes to a head at the time when interest rates are still close to zero in many Developed Markets with many government bonds trading at zero or negative yields, exacerbating the income shortfall.

 

When can income seekers search for opportunities? Dividends from Equities can provide an interesting yield potential. On Equities, it is important to search for companies that can deliver sustainable dividends, but also try to mitigate their potential market volatility. When considering Fixed Income, we believe that the ability to actively search for value across all sectors and geographies, including below Investment-Grade and Emerging Markets, can offer more opportunity to pursue the targeted level of income. An active Multi-Asset approach can potentially benefit investors by providing a holistically managed solution across all asset classes, from bonds and stocks, to real assets.

 

For income investors it is time to broaden their perspective, taking a more active approach, and exploring a wider range of potentially higher-yielding investment opportunities across different asset classes with varying levels of risk.