In today’s rising rate environment, traditional fixed income may struggle to deliver the same types of total returns that it has in the past. Historically, as interest rates rise, bond prices fall, often resulting in declining in returns for traditional fixed income products.
Looking ahead, we believe investors need to expand their investable universe beyond traditional fixed income to find attractive income opportunities. However, many non-traditional income generating assets come with their own unique risks, which can make them difficult to navigate.
Oppenheimer Global Multi-Asset Income Fund seeks to deliver attractive and consistent levels of monthly income by actively allocating across various income-producing asset classes – including not only traditional fixed income, but also stocks, real assets and alternatives.
This Fund was specifically designed to address investor demand for diversified sources of income given the low rate environment and a large population of retiring Baby Boomers. It is designed to serve as a core portfolio holding for conservative investors who are seeking monthly income.
It will typically have less sensitivity to bonds and interest rates due to the diversity in underlying exposures across traditional and non-traditional income generating assets.
The Team’s Approach to Risk Management
The team employs a risk-aware approach that looks to mitigate the downside during times of stress. This active approach to risk management plays a significant role in the investment process and is done in two ways:
- Continual adjustment of the portfolio’s asset allocation to target a certain level of risk.
- Active hedging of unwanted risk in the portfolio to mitigate the effects of shocks in the broad market.
Potential risks are also monitored closely through stress tests and scenario analyses to identify potential vulnerabilities.
These views represent the opinions of OppenheimerFunds, Inc. and are not intended as investment advice or to predict or depict the performance of any investment. These views are as of the publication date, and are subject to change based on subsequent developments.