J.P. Morgan Asset Management sees value in high-quality corporate bonds as a hedge against AI-heavy portfolios

News Editor

2026-10-11 02:35:04

J.P. Morgan Asset Management is taking a constructive view on high-quality fixed income, arguing that investors can lock in attractive yields without moving too far down the credit spectrum. In remarks cited from a CNBC interview, investment manager Priya Misra said top-quality corporate bonds are currently offering around 6.5% yields, giving market participants a way to earn strong income without relying on high-yield debt. The firm also said bonds can help offset concentration risk in portfolios that have become heavily exposed to artificial intelligence and technology stocks. Misra said fixed income offers a broader mix of return sources, including U.S. Treasuries and corporate credit outside the tech sector. J.P. Morgan Asset Management has also started extending duration and selectively adding exposure to some BB- and B-rated bonds as credit spreads widen. A similar view came from BondBloxx co-founder Joanna Gallegos, who said current bond yields remain historically attractive. She pointed to solid corporate fundamentals and ongoing economic growth as support for adding corporate debt to portfolios, while also noting private credit and collateralized loan obligations, or CLOs, as additional defensive income options. At the same time, the analysis warned that high interest rates are still weighing on sectors such as real estate.

J.P. Morgan Asset Management is bullish on high-quality fixed income, saying the current rate backdrop is giving investors a rare opening to add exposure. The firm’s view is that buyers can earn attractive yields in investment-grade corporate bonds without taking on excessive credit risk.

Top-quality corporate bonds are yielding about 6.5%

In an interview with CNBC, J.P. Morgan Asset Management investment manager Priya Misra said investors can currently get roughly 6.5% yields from the highest-quality corporate bonds issued by strong borrowers. That, she said, means investors do not need to move into high-yield bonds just to seek stronger returns.

Misra also said the firm has recently started extending portfolio duration as the interest-rate cycle gets closer to its endpoint. At the same time, it has modestly increased exposure to some BB- and single-B-rated debt to capture potential opportunities created by wider credit spreads.

Bonds seen as a way to reduce concentration in AI and tech holdings

Misra said many investors are dealing with a familiar portfolio problem: too much exposure to artificial intelligence and technology stocks. Fixed income, by comparison, offers a wider range of return streams. That includes U.S. Treasury trading as well as corporate credit tied to industries outside tech.

She said that kind of diversification can help stabilize portfolio swings and add protection when the broader economy turns volatile or when a single sector goes through a correction.

Corporate fundamentals and private credit also drew attention

BondBloxx co-founder Joanna Gallegos expressed a similar view, saying bond-market yields remain at historically attractive levels. She said adding corporate bonds to a portfolio can support steady cash flow when company balance sheets remain strong and the economy is still growing.

Gallegos also pointed to the development of private credit and collateralized loan obligations, or CLOs, as giving investors a broader set of defensive income options in fixed income markets.

High rates are still pressuring some sectors

The analysis also warned that elevated rates continue to weigh on specific parts of the economy, including real estate. Investors, it said, still need to assess macro conditions and the fundamentals of individual issuers with care.

This article was originally published by Bit.Fan. For more cryptocurrency news and market insights, visit www.bit.fan.

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