Our Total Return strategies are designed to offer you a more flexible approach to investing in bonds compared to traditional fixed income funds. This flexibility allows us to take advantage of opportunities to effectively address your Total Return ambitions.
Our strategies aim to help you maximise total returns, primarily through investment in a flexible allocation of debt securities and cash. We are free from benchmark constraints, and can actively allocate to corporate bonds, government debt, high yield bonds, developed and emerging market, and cash across fixed income markets globally.
Flexibility is the cornerstone of our philosophy. We only invest when we believe the return potential is sufficient to compensate for the risk and adjust our asset allocation in response to market changes. This means that we sometimes reduce the market risk in our portfolios significantly, when we feel the reward is insufficient. This flexibility also allows us to actively manage various risks such as duration, credit, yield curve and currency risk, on both a short-term tactical and long-term strategic basis.
Let us know your preferences to receive insights and ideas on the themes, strategies and products of most interest to you.
Global Fixed Income Strategy Monthly Report
In our regularly updated macroeconomic analysis we offer an outlook for interest rates and currencies – and look at which fixed income assets are favoured across a range of market environments.
Why Bank Loans for insurance companies?
Discover why senior secured loans offer insurers high income, low risk, and strong fundamentals. Improving returns and reducing capital charges.
The future of fixed income investing; takeaways from our webinar
As we enter the final quarter of the year, our experts look back at the ‘year of the bond market’ and share their thoughts on the outlook for Fixed Income assets going forward.
Monthly fixed income ETF update
Bond markets rallied in September as the Federal reserve cut rates by 50 basis points for the first time this cycle, responding to mixed economic data and a softening labor market. Read our latest thoughts on how fixed income markets performed during the month and what we think you should be looking out for in the near term.
Yields remain attractive and may maintain positive relative value
Significant focus on the uncertainty of the US macroeconomic backdrop and its potential implications on the market remain top of mind for investment opportunities. Against this cautious outlook, we asked the experts from Invesco’s bank loan, direct lending and distressed credit teams to share their views as the third quarter of 2024 wraps up.
The total return on an investment includes interest, capital gains, dividends, and distributions realised over a given period of time. Therefore, Total Return strategies may be appropriate for investors seeking both current income and capital appreciation, through investment growth.
Yield is defined as the income return provided by the bond, which is the interest or dividends received, usually expressed annually as a percentage of the price of the bond.
Traditional bond strategies, such as high yield and investment grade, typically focus more on yield and seeking to generate an income while preserving the initial investment.
Total Return includes both income and appreciation of capital. Total Return investors typically focus more on the growth in their portfolio over time than on the yield in a given period. They will take distributions as needed from a combination of the income generated from the yield on various holdings and the price appreciation of securities.
Investors should understand the key differences between yield and total return so their portfolios are constructed to meet income-generating needs while providing a level of growth.
Duration is one of the fundamental characteristics of a bond, used to assess the sensitivity of a bond’s price to changes in interest rates.
A yield curve is a line that plots the yields or interest rates of bonds that have equal credit quality but different maturity dates.
It can be used as a benchmark for other interest rates in the market, such as mortgage rates and bank lending rates, and investors can use the yield curve to make investment decisions that factor in the likely direction of the economy.
Currency risk is the risk that investment performance may be adversely affected by variations in the exchange rates between the base currency of a portfolio and the currencies in which the investments are made.
Investments in Total Return strategies can be made by either investing in actively managed mutual funds or exchange traded funds (ETFs). Invesco offers a broad range of actively managed Total Return funds and ETFs.
Invesco Tactical Bond Fund
The value of investments and any income will fluctuate (this may partly be the result of exchange-rate fluctuations) and investors may not get back the full amount invested.
Invesco Tactical Bond Fund (UK) - Please refer to the risks numbered 1, 2, 3, 4, 5 and 6
1 The debt securities that the Fund invests in may not always make interest and other payments and nor is the solvency of the issuers guaranteed. Market conditions, such as a decrease in market liquidity, may mean that the Fund may not be able to buy or sell debt securities at their true value. These risks increase where the Fund invests in high yield, or lower credit quality, bonds.
2 The Fund has the ability to make significant use of financial derivatives (complex instruments) which may result in the Fund being leveraged and can result in large fluctuations in the value of the Fund. Leverage on certain types of transactions including derivatives may impair the Fund’s liquidity, cause it to liquidate positions at unfavourable times or otherwise cause the Fund not to achieve its intended objective. Leverage occurs when the economic exposure created by the use of derivatives is greater than the amount invested resulting in the Fund being exposed to a greater loss than the initial investment.
3 As the Fund has wide discretion to dynamically allocate across the debt securities spectrum and between that asset class and cash, the risks relevant to the Fund will fluctuate over time, which may result in periodic changes to the Fund’s risk profile.
4 The Fund may invest in contingent convertible bonds which may result in significant risk of capital loss based on certain trigger events.
5 The Fund’s performance may be adversely affected by variations in interest rates.
6 The Fund has the ability to invest more than 35% of the value in Government and public securities issued or guaranteed by a single body.
Invesco Global Total Return (EUR) Bond Fund
For complete information on risks, refer to the legal documents.
The value of investments and any income will fluctuate (this may partly be the result of exchange-rate fluctuations) and investors may not get back the full amount invested. Debt instruments are exposed to credit risk which is the ability of the borrower to repay the interest and capital on the redemption date. Changes in interest rates will result in fluctuations in the value of the fund. The fund uses derivatives (complex instruments) for investment purposes, which may result in the fund being significantly leveraged and may result in large fluctuations in the value of the fund. Investments in debt instruments which are of lower credit quality may result in large fluctuations in the value of the fund. The fund may invest in distressed securities which carry a significant risk of capital loss. The fund may invest extensively in contingent convertible bonds which may result in significant risk of capital loss based on certain trigger events. The Fund may invest in a dynamic way across assets/asset classes, which may result in periodic changes in the risk profile, underperformance and/or higher transaction costs.
Invesco Tactical Bond Fund
Data is as at 30/06/2024 and sourced from Invesco unless otherwise stated.
This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication.
Views and opinions are based on current market conditions and are subject to change.
For the most up to date information on our funds, please refer to the relevant fund and share class-specific Key Investor Information Documents, the Supplementary Information Document, the financial reports and the Prospectus, which are available using the contact details shown.
Invesco Global Total Return (EUR) Bond Fund
Data as at 30.06.2024, unless otherwise stated. By accepting this material, you consent to communicate with us in English, unless you inform us otherwise. This is marketing material and not financial advice. It is not intended as a recommendation to buy or sell any particular asset class, security or strategy. Regulatory requirements that require impartiality of investment/investment strategy recommendations are therefore not applicable nor are any prohibitions to trade before publication. Views and opinions are based on current market conditions and are subject to change. For information on our funds and the relevant risks, refer to the Key Information Documents/Key Investor Information Documents (local languages) and Prospectus (English, French, German, Spanish, Italian), and the financial reports, available from www.invesco.eu. A summary of investor rights is available in English from www.invescomanagementcompany.lu. The management company may terminate marketing arrangements. Not all share classes of this fund may be available for public sale in all jurisdictions and not all share classes are the same nor do they necessarily suit every investor.
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