'Dividend aristocrats', EM bonds key strategies in 2020 for conservative investors: BNP Paribas

Singapore

WITH bond yields depressed and a moderate earnings recovery expected in 2020, BNP Paribas is advising conservative investors, who tend to allocate a bigger proportion of their portfolio to fixed income than equities, to accumulate "dividend aristocrats".

These developed-market stocks, which have increased payouts in each of the past 25 years, historically offer better-than-average risk/return compared to other equities.

They also provide protection against inflation if it were to rise.

But BNP Paribas' recommendation comes with a caveat - investors must be willing to accept the higher volatility of equities and go in long term, it said in an investment outlook repo…