Preparing your portfolio for the new year

New Asian bonds are flooding the market before the US Federal Reserve tapers its bond-buying but investors should tread carefully and weigh up the new offerings against what is already out there.

Nagging questions over the outlook for US monetary policy and worries related to the Chinese property market and economy mean debt investors positioning themselves for 2014 should consider shorter-term Asian bonds, which still offer more flexibility and certainty on yield.

Since the global sell-off in bonds seen over the summer, when talk of imminent US policy tapering was rife, there has been a rush of new Asian debt issuance as companies looked to complete financing programmes before Christmas. The volume of US-dollar denominated debt hit another record in 2013. 

Chinese issuers alone have increased their issuance of US dollar-denominated debt by roughly 75% year-on-year, in...

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