Not bound by Bunds: Why peripheral bonds could be key to unlocking alpha

In Short

In turbulent times, active management is crucial. Despite the high levels of volatility in European sovereign bonds year-to-date arising from Russian invasion of Ukraine and higher ECB interest rates, the Generali Investments SICAV(GIS) Euro Bond sub-fund has outperformed the benchmark. This is thanks to a highly active approach to duration management and diversified exposure that includes a significant allocation to peripheral European countries as well as to inflation-linked bonds.

In this article, we explain

  • How Mauro Valle nimbly adjusted portfolio duration in response to major market events in 2022
  • Why peripheral European government bonds from Italy and Greece present pockets of value
  • How diversified European government bond exposure can provide a hedge against volatility and offer defensive, risk-adjusted returns
  • How the GIS Euro Bond sub-fund has outperformed versus the benchmark throughout a negative-yielding environment

 

Mauro Valle_GIS Euro Bond.pdf

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