Polar Capital

Polar Capital European Income Funds - In Defence of Defensives

A combination of global growth, Fed rate hikes and the ECB tapering QE has presented a headwind for the bond-proxy defensive assets our process is skewed towards. This skew is produced because of the quality threshold we put on companies to make a 10% return on equity through the cycle, not just during a cyclical upswing, so naturally, when the economic outlook brightens these defensive assets lag more economically-sensitive ones.

Read the full article here: In Defence of Defensives