The Case for Investing in Durable Income
Investing passively in traditional fixed income exposes investors to low expected returns, has little scope for capital appreciation, comes with significant interest rate risk, forsakes opportunities in unlocking an illiquidity premium, as well as excludes niches in credit investing. Durable Income, unlike fixed income is more resilient to economic downturns, to changes in credit and market risk, for it has its foundation in multiple return drivers. This paper discusses Durable Income from an alternative investments perspective. It points out essential differences between Durable Income and fixed income alternatives, outlines the investing case and explores its potential role in investment portfolios.
Jain, Sameer, The Case for Investing in Durable Income (September 4, 2013). Available at SSRN: http://ssrn.com/abstract=2320734