Bond Market Indexation Strategy Essay Example | Topics and Well Written Essays - 250 words - 1

Bond Market Indexation Strategy - Essay Exampleof returns, puffiness protected securities are mainly judicature issued wedges whereby the inflation is adjusted according to the principal on each bond (Pistolese Clifford, 16).Protection of inflation is the major motivation for investing in IPS either in a global basis or single market. Moreover, there is an enhanced alpha potential and diversification in a global approach to inflation protected security. Pistolese Clifford added that, inflation pressure comes as a result of many sources that exist in both local and global economies (16). But traditional bond are not regarded as inflation adjusted. Inflation can therefore reduce the return of investment of traditional equity as only almost inflation percentage may be considered through equity returns. In conclusion, not only global IPS protects against prolonged inflation demands but also mend alpha potential as well as diversification to global bond