Wealth management forum: Corporate bonds - overheated, or just right?

Is the backlash against corporate bonds beginning? Luke Hickmore, investment director on Scottish Widows Investment Partners' bonds team, argues that while it's too late to invest in gilts and still too early to move back into equities, credit is 'just right' - but not everyone agrees.

Charles MacKinnon of Thurleigh Investment Managers warns that the sector is far more dangerous than investors realise, while Mike McCroddan of Conforto says corporate bonds are now overpriced. Last week Roger Bootle, our keynote speaker at the forum, told bond investors to brace themselves for widespread defaults.

But while Hickmore agrees up to a point, he says there is deep value to be found if you know where to look. He also explains why flattening credit spreads may indicate that there is light at the end of the tunnel for equities.

Also in this series:

• Roger Bootle of Capital Economics warns investors not to expect any good news just yet
• Matthew Strachan of Alliance Trust has some encouraging news from the US  
• Adrian Bignell of Invesco Perpetual believes present valuations of European small caps offer bargains to the careful investor
• Wilfred Sit of Mirae Asset Global Investments argues the case for increasing exposure to Asia, but has the tiger lost its roar?
• Advisory or discretionary? Attendees at the Citywire Wealth Management forum discuss the future of the industry, and how clients are responding to unprecedented volatility.