Investment diversification

Investors were caught between hotter US inflation and economic data and growing nerves around the sustainability of the AI investment boom.

Global bond markets remain under pressure due to renewed inflation concerns and a general shift to tighter monetary policy.

Investors in passive bond funds are being exposed to more risk than they may appreciate as US technology giants turn to fixed income markets to fund massive spending on AI data centres, argues Aviva Investors chief executive Mark Versey. 

Diversification has always been at the heart of asset management, but recent turmoil, from higher inflation to conflict, trade barriers and the AI revolution, is roiling markets. Can investors still reap its benefits?

The ‘Magnificent Seven’ group of Big Tech companies is no longer the key driver of US equities, as the rally broadens out to other sectors.

Precious metals such as gold and silver, rare earth minerals, and industrial metals such as copper have been making headlines in recent months. We talked to a team of experts to discover what’s been driving investors’ appetite.

With Iran and the US competing to block the Strait of Hormuz, oil, gas and fertiliser trade disruptions are impacting markets.

In this article, we explain key concepts of bond investing, such as yield and duration, explore the role of bonds in investment portfolios and look at the current state of the bond markets.