Investing for Sustainable Income: Diversification Matters

We discuss how a mix of investments may help boost return potential while helping to temper overall volatility.

By Radu C. Gabudean & Nancy Pilotte - October 2018

Introduction

Since the 2007-2008 financial crisis, unprecedented accommodative monetary policies and low interest rates have created challenges for investors seeking income from familiar sources, such as bonds and dividend-paying stocks. Despite recent Federal Reserve rate hikes, interest rates and dividend yields remain low by historical standards. Outside the U.S., including in Europe and Japan, yields are even lower, as central banks maintain aggressive easing programs.

We believe investing for income in today’s low interest rate environment requires a broadly diversified strategy with a goal of providing sustainable income. Senior Client Portfolio Manager Nancy Pilotte recently spoke with Portfolio Manager Radu Gabudean about income diversification and professional management and how they can help investors achieve the competing goals of income, total return, and risk management.

Radu C. Gabudean, Ph.D.
Portfolio Manager
Multi-Asset Strategies
Nancy Pilotte
Nancy Pilotte
Senior Client Portfolio Manager
Multi-Asset Strategies

Investing for Sustainable Income: Diversification Matters

October 2018: Q&A

Download PDF
  • Related Articles
  • More From Author

Developed Non-U.S. Equity Outlook

While uncertainty over trade policies and Brexit negotiations is weighing on corporate sentiment, learn why we believe the outlook for 2019 non-U.S. corporate earnings growth remains positive.

Recent Setbacks in Emerging Markets

Consider current conditions as short-term difficulties and remain focused on the longer-term positive outlook for the region.

Brave New World: Equity Investing in the Age of Artificial Intelligence

Learn about how artificial intelligence is scaling investment decisions and changing the investment management industry all together.

    Investing for Sustainable Income: Diversification Matters

    We discuss how a mix of investments may help boost return potential while helping to temper overall volatility.

      Diversification does not assure a profit nor does it protect against loss of principal.

      Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost. Past performance is no guarantee of future results.

      The opinions expressed are those of American Century Investments (or the portfolio manager) and are no guarantee of the future performance of any American Century Investments' portfolio. This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.

      FOR INSTITUTIONAL USE ONLY | NOT FOR PUBLIC USE