Navigating the search for income
Investors seeking a yield pick up over cash (and a safe haven), have traditionally bought government bonds and it is easy to see why. At the beginning of 2002, for example, 10-year German government bonds yielded more than 5% while inflation remained below 3%¹. The 2008 global financial crisis (GFC) changed all that. In some countries, investors saw yields spike and capital values plummet, amid concerns about mounting government debt and threats of default, while in others yields fell sharply as investors retreated to safe havens.