Short Duration Bonds: A Compelling Alternative to Traditional Fixed Income

When considering allocations to fixed income, short duration convertible bonds should not be overlooked. With elevated yields on the short end of the curve and an uncertain pace of further rate cuts, we believe investors can take advantage of opportunities in short duration convertible bonds rather than endure the risk of longer duration fixed income. Short duration corporate bonds with convertible features can potentially offer attractive yields with differentiated sources of return while limiting interest rate risk.