Senior secured loans: investing in a “higher for longer” interest rate environment

Senior secured loans: why now?

Many of the most commonly used fixed income investments, such as high-quality government bonds, generate negative or low real returns in today’s high inflation environment. Consequently, these investments pose a significant duration risk to portfolios.

Despite inflation expectations being anchored, inflation remains high, and the US Federal Reserve has signalled a hawkish stance to keep rates higher for longer.

We believe the current uncertain market environment calls for fundamental changes in asset allocation in order to meet long-term real return targets.

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