In corporate debt, you have the credit risk of borrower defaulting and that's why people rely on the rating agencies to provide a guide on the default risk, and the other risk is that there could be a blow out in yields, for instance, you buy a portfolio and inflation takes off or companies go bust.
More Quotes from Shane Oliver:
So on this basis, and thanks to very strong earnings growth, the Australian share market is still cheap.Shane Oliver
Cheap products from China and a very competitive pricing environment is helping keep underlying inflation in check. Interest rates are on hold for the time being.
Shane Oliver
An upside risk for Australian shares though is that a bubble forms on the back of enthusiasm for China and resources stocks.
Shane Oliver
Based on the current level of bond yields and earnings fair value around 5 600 points, the dividend yield remains attractive compared to alternative investments.
Shane Oliver
Today's decision will slow the recovery we've been seeing in retail sales and housing. It will be a knock on the head for both.
Shane Oliver
The situation is far healthier. The risk of another Asian crisis is very low.
Shane Oliver
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