6 min read 9 Jun 22
It has been a tough year for markets so far. Notably, some of the drawdowns across the fixed income space, especially investment grade and emerging market debt, have been consistent with the drawdowns we have seen from the equity market. This tells us that this comes down to the discount rate. The market understands that liquidity needs to be withdrawn, and that we are no longer operating in a super accommodative environment. Therefore, the path of markets is likely to continue to be choppy going forward, in our view.
The value of investments will fluctuate, which will cause prices to fall as well as rise and you may not get back the original amount you invested. Past performance is not a guide to future performance.