Financial upheavals inflicted on the world over the past few years have left private banking clients feeling edgy about their equity investments - thus prompting them to seek alternative solutions.
Ivan Leung, chief investment strategist at JPMorgan Private Bank, said his firm had been tailoring such investment solutions for clients who are hesitant about raising their exposure to equity investments. These options include fixed-income instruments, currencies, distressed real estate and commodities.
'We continue to advocate for currency diversification for the long term, especially with emerging market currencies and commodities,' said Leung.
In the area of fixed income, strong corporate fundamentals as well as supply and demand dynamics should support a high yield over the near term, he said.
'We expect default rates to remain low for the US in 2012, but markets are pricing in a higher expectation. As a result, we continue to favour high-quality, high-yield,' Leung said.
An area where investors can expect to get higher yields is in the private credit market, where the lack of financing is allowing investors to lend at higher rates.