The public fixed income portion of the Fund invests in a variety of fixed income investment types, including:
- Government of Canada bonds,
- Provincial and municipal bonds, and
- Canadian and U.S. corporate bonds.
Public fixed income investments provide a consistent stream of income, with generally less volatility than equity market investments. The public fixed income asset class is multidimensional, with bonds that can be issued in many different maturities, from several different places in the capital structure (holding companies, operating companies, finance companies), and can be secured by assets or unsecured. Public fixed income investments trade on secondary markets and can be bought and sold at any time.
These investments are often used in liability matching strategies for pension plans, insurance companies and other institutional investors, as they are well suited to capital preservation goals. High quality fixed income investments provide far greater security of capital than equity investments.