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Fixed Interest · Managed Fund · 7 MIN READ

Fixed Income Trade Offs

Fixed income is often described as the defensive part of an investment portfolio. For many investors, it is expected to provide regular income, reduce reliance on share market returns and help smooth the overall investment journey. That description is broadly right. But it can also create an unrealistic expectation that fixed income investing is simple, safe and always stable.

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The CRED advantage: equity-like returns with the security of debt

With interest rates remaining elevated, commercial real estate debt (CRED) funds have emerged as an increasingly attractive option for investors. Offering stable, income-generating opportunities and attractive, risk-adjusted returns, these funds are gaining ground as one of the fastest-growing segments of the private debt market. Despite challenges in the broader real estate sector, including declining office valuations, structural tailwinds like housing undersupply in key markets, population growth, and the rise of e-commerce and data centres are driving long-term demand for CRED.

22 Nov 2024
 · 5 MIN READ

The ugliest two words in the dictionary

Trump talked a big game on tariffs during his journey back to the White House. ‘If I’m going to be president of this country, I’m going to put a 100, 200, 2,000 per cent tariff,’ on cars from Mexico he forewarned. He went so far as to describe tariffs ‘as the most beautiful word in the dictionary.’ Investors should prepare for two uglier words...

20 Nov 2024
 · 6 MIN READ

Four charts that show why the private markets are booming

The rise of private market investing is continuing unabated with more and more individual investors allocating up to 20-25%+ of their portfolios to the asset class. This trend appears set to continue with a growing number of investors who don’t currently have private markets exposure actively considering whether it’s aligned with their investment plan and goals.

18 Nov 2024
 · 4 MIN READ

A storm is brewing in the US

With the S&P 500 rallying an historic 40% over the past twelve months, you’d be forgiven for thinking all is well with the US Government’s finances. After all, the state of the world’s largest economy is inextricably connected with the US Treasury’s financial health. Sorry to shatter that illusion, but the truth is very different. Do not read what follows if you prefer to believe in the US fairy tale…

6 Nov 2024
 · 6 MIN READ

Megatrends for 2025 and beyond

Megatrends are long-term structural changes that affect the world we live in. Importantly, they shape communities, but they also create investment opportunities and risks. What Magellan has learned from historical megatrends is: 1) they often solve a problem through innovation; 2) the scope of the megatrend can initially be underestimated; and 3) the duration of a megatrend is typically longer than anticipated. There are numerous megatrends likely to influence markets that investors should consider: the shift to the cloud and generative AI, the ageing population, rising geopolitical tensions and so on. Today we highlight just some of the megatrends we are monitoring at Magellan.

4 Nov 2024
 · 6 MIN READ

Why rate cuts aren’t bad news for mortgage funds

With interest rates at a decade-high and the RBA signalling potential rate cuts sometime next year, the current yields on mortgage funds present an attractive opportunity. Mortgage funds have gained traction as higher interest rates have made lending to the commercial real estate sector increasingly attractive. This shift has occurred while traditional property investments such as real estate investment trusts are facing significant valuation challenges. According to a recent report by investment firm Zagga, more investors are gravitating toward private real estate debt for property exposure in order to avoid the volatility typically associated with property markets. This trend is fuelled b

31 Oct 2024
 · 4 MIN READ

The seismic shifts afoot in fixed income markets

More than a few fund managers have highlighted that fixed income investing these days is a world away from what it used to be. They’d be right. The very structure of global fixed income markets has changed since the Global Financial Crisis. As with all structural shifts, it pays to revisit the here and now on occasion to ensure your current strategy is fit for purpose. The reality is the strategies necessary to generate alpha in fixed income markets are different from the past.

28 Oct 2024
 · 5 MIN READ

The Fed’s cut may be the starter gun for small cap outperformance

With the Fed initiating a rate cutting cycle in September, investors are increasingly focusing on asset classes positioned to outperform in a falling rate environment. Enter smaller companies. Historically, small-cap stocks have outperformed their larger counterparts during periods of declining interest rates — and this trend seems to be taking hold as both global and domestic small-cap benchmarks have shown improved performance in recent months.

24 Oct 2024
 · 5 MIN READ

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