Fixed IncomeSep 12 2016

100 Club: Newton’s Cunningham laments ‘dangerous’ duration

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100 Club: Newton’s Cunningham laments ‘dangerous’ duration

Mr Cunningham also warned against too much reliance on central bank intervention to boost the economy, joining the ranks of those now questioning the power of monetary policy.

“I think you have to bear in mind that with low yields and low duration comes more risk to capital and we are getting very dependent on intervention. The belief in central banks’ powers tends to wax and wane and at the moment there seems to be a lot of faith being placed in the BoE in particular.”

The Newton Long Corporate Bond fund has delivered 44 per cent over three years, while the IA Sterling Corporate Bond sector returned 25 per cent in the same period, data from FE Analytics shows.