Podcast : Smart beta investing in corporate and sovereign bond markets

RAFI Bond Indices are based on a transparent rules-based methodology that weights bonds using economic measures of company or country size. The results are indices that are correlated with debt service capacity–tilted toward higher credit quality firms or countries with lower risk of downgrade or default. Whether for corporate bonds or sovereign debt, the resulting indices historically have offered better risk-adjusted returns, according to simulations.

Traditional bond indices, which are weighted by the amount of debt outstanding, may not always be optimal for passive solutions. In traditional indices, the most indebted issuers receive the largest index weights, leaving investors overexposed to companies or countries with high debt burdens and credit risk.

Our approach to building a better bond solution is to create a better foundation for fixed income investing that stresses higher quality, lower risk, and improved risk-adjusted returns, while maintaining the benefits of passive index investing, i.e., transparency, broad representation, and diversification. RAFI Bonds offer a more thoughtful fixed income solution.




The Association of International Wealth Management of India (AIWMI) is a not-for-profit organization and a globally recognized membership association for finance professionals. AIWMI primarily focuses on the broad and strategic role of developing a more robust and forward-looking training infrastructure for the financial services sector and to promote more active industry involvement and collaboration in training and continuing education. AIWMI is offering advanced international certification programs along with a wide variety of high-quality executive education programs. AIWMI programs combine state-of-the-art knowledge and skills with practical experience and insights into the functioning of the financial sector. All AIWMI courses and educational events have an intense and pragmatic curriculum. Participants are exposed to the latest developments within the financial services sector. AIWMI plays a key role in guiding the development of the financial services sector. AIWMI works with key industry participants’ viz. the Government, the Regulators, the Industries/Associations, the Corporate, the Media and the General Public to achieve its objectives. Besides enhancing technical competence and professionalism in the industry, AIWMI organizes events and facilitates discussions to promote best practices in leadership and talent development in the financial sector with an aim to become Asia’s premier center of excellence for financial education.

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