Fixed income

Our culture of connectivity means there isn’t a fixed income market or sector in the world where we can’t offer a diverse and informed view.

Through experience and ingenuity, we identify opportunities in the active and passive space to ensure we’re at the forefront of fixed income investing.   

As we journey to a more sustainable future, we build fixed income solutions that allow investors to incorporate their ESG objectives. 

For many years, low yields have created a tough environment for investors looking to generate income through bond exposure. 

With inflationary pressure building, several central banks have now raised interest rates, with further hikes on the horizon. 

At Invesco, we offer a broad range of income solutions to help you navigate this changing market landscape. 

Find out more about our income solutions: 

• Senior loan funds
• Mixed asset funds
• AT1s
• Municipals
• Short duration funds
• Tactical bond funds

Our active teams integrate ESG considerations in their fundamental research processes, carrying out their own proprietary assessments and using Invesco’s in-house ratings tool. This allows them to fill in any gaps left by holes in the third-party data. Engagement and dialogue are important parts of the process.  

Our passive capabilities incorporate ESG considerations through positive and negative exclusions and, where holdings overlap, benefit from the engagement activities carried out by our active fixed income teams. 

ESG matters to our clients, and it matters to us. We’re here to help you navigate this evolving landscape with our broad range of products – from exclusionary strategies, to strategies which carry out positive screening, to products that benefit from our active engagement approach. 

We spotlight three of these products, active and passive, below: 

• Invesco ESG Senior Loans Suite
• Invesco Environmental Climate Opportunities Bond Fund 
• Invesco GBP Corporate Bond ESG UCITS ETF 

Want to know more about what some of our other investment teams are embracing ESG? Have a look at our recent article: ‘Undaunted by the ESG challenge’. 

‘Local currency bonds’ are debt securities issued by sovereigns or corporates in their local currency. 

‘Hard currency bonds’ are debt securities issued by sovereigns or corporates in other currencies – usually US dollars.

Hard currency strategies are sometimes deemed less volatile than local currency strategies, as they are exposed to less currency risk, but they can offer the potential for attractive returns. 

AT1s, or Additional Tier 1 Capital Bonds are securities issued by European banks for regulatory purposes. 

Given their subordinated position within the capital structure, AT1s offer a higher yield than more senior debt from the same issuer. Furthermore, they are callable securities, which means they have relatively little interest rate risk. 

These hybrid securities have become increasingly attractive for yield-seeking investors, with the asset class maturing to a current market capitalisation of over US$250 billion.1