As hybrid instruments are phased out, fixed income markets are flooded with new product offerings, raising concerns about conflicted advice.
Alex Pikoulas from Munjarra Capital says historically, advisers have received fees for recommending hybrid issues, which are complex and often confusing for investors. He says while hybrids are seen as attractive income solutions, their complexity and associated risks must be carefully considered.
Many fixed income managers are launching new products to capitalize on the shift, but Alex says investors need to remain cautious and assess whether these new offerings truly meet their needs.
