FIAs compared to Bonds

May 17, 2022 by Barclays

May 2022

Innovation in the FIA space has markedly improved the offering and this provides a very important distinction to bonds. We find that examples of this innovation in FIAs have outperformed bonds on a consistent basis over the last 25 years.

• Both FIAs and bonds are principal protected, however bonds are exposed to yields whereas FIAs can participate in a wide range of exposures other than yields.
• Yields are near historical lows, and past bond performance has been driven partly by decreasing yields.
• Past bond performance might not be repeatable, and increasing yields will act as a headwind to bond performance
• FIAs offer flexible exposures to a diverse range of investments, including the latest equity smart betas and dynamic multi-asset portfolios.

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Originally Posted at Barclays on May 2022 by Barclays.