(Oct 4): Stocks still look particularly attractive in a world of ultra-low bond yields, according to Southeast Asia’s largest bank DBS Group Holdings.
Equities are a better risk-reward play than bonds, which are looking expensive after this year’s big rally, Chief Investment Officer Hou Wey Fook wrote in his fourth-quarter asset allocation report. He recommends dividend shares and gold as well as hybrid European AT1 securities.
Institutional funds “have little choice but to turn to equities,” Hou wrote. “As the trend of ever-lowering bond yields continues on the back of a renewed cycle of policy easing by global central banks, other higher-yielding asset classes have risen to be the next ‘bond proxies.’”
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