Striking oil
This year has been good for corporate bonds and the trend looks set to continue. David Watts discovers where the strategists say profits will come from in 2004
It is truly clear-cut: 2003 heralds a reversal of six years of bear markets for US corporate bonds; the year to late November produced the strongest performance from the asset class since 1988, according to Lehman Brothers.
In the 11 months to late November, Bear Stearns’ investment-grade corporate bond index registered spreads on high-grade corporates tightening by 62bp, to 110bp over Treasuries – a 115bp tightening since the wides on October 11.
However, while the rally has been a
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