Reported 5 months ago
Credit bulls are highlighting that high-grade bonds are currently exceptionally cheap compared to stocks, with data showing the biggest value gap between credit and equities in over 20 years in the US and over a decade in Europe. This trend is renewing interest in corporate debt as an attractive investment option, particularly for investors like Morgan Stanley Wealth Management and Tikehau Capital, who see bonds offering a more compelling case for exposure to companies due to risk premiums nearing post-crisis lows over sovereigns. With the relentless rally in stocks and expectations of higher interest rates, bonds are seen as a promising alternative to equities, potentially rivaling equity returns on a risk-adjusted basis.
Source: YAHOO