Clients fled to cash when yields were high and their risk tolerance was low. Are they ready to put that cash back to work? If they stay in cash too long, they’re exposed to a different set of risks that could derail their long-term portfolio goals. Get them back on track in three steps: Lock in, tune up, and stand out.
We expect the Federal Reserve to lower rates at some point, which leaves cash portfolios vulnerable to reinvestment risk. Increasing duration through fixed income strategies can help your clients lock in their yields before that happens. These fixed income investment strategies offer a way to extend duration and lock in yields for longer.
Don't let the short-term refuge of cash turn into a long-term drag on growth potential. Seek to build strong core portfolios that can help your clients pursue their investment goals in changing market conditions. These investment strategies provide the return potential that a cash-heavy portfolio may be missing.
Don't let tough markets take a toll on your client relationships - building strong relationship equity and trust can help you drive better outcomes. Talk to your clients about why it's important to put excess cash to work, and use our research-backed programs to articulate all the ways you add value beyond just investing.
Beyond money markets: Maximizing your cash
Higher interest rates have enticed investors into money markets. But they aren’t necessarily risk free, while stocks and bonds have historically returned more over the long term.
Market Conversations: The midyear market mood
Kristina Hooper and Alessio de Longis join Brian Levitt to talk about Invesco’s midyear investment outlook, including “recession obsession,” the path ahead for interest rates, and their views of equities, fixed income, and real estate.
When you're ready for a partner, not just a provider, we can connect you with a team focused on your unique needs and situation.
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Fixed income investments are subject to credit risk of the issuer and the effects of changing interest rates. Interest rate risk refers to the risk that bond prices generally fall as interest rates rise and vice versa. An issuer may be unable to meet interest and/or principal payments, thereby causing its instruments to decrease in value and lowering the issuer’s credit rating.
The risks of investing in securities of foreign issuers, including emerging market issuers, can include fluctuations in foreign currencies, political and economic instability, and foreign taxation issues.
Invesco Global Consulting programs are for illustrative, informational and educational purposes. We make no guarantee that participation in any programs or utilization of their content will result in increased business for any financial professional.
