Bond managers "haven't been at the party" equity managers have enjoyed in the past five years. But that could change in the next year, according to Cambridge International Partners Inc.
"We see fixed income as a neglected sector," said Paul Holt, president. "But it could become more attractive in the next year or two because the cycle is likely to change."
Cambridge International is a New York-based investment bank specializing in transactions in the investment management industry.
Mr. Holt believes that when equity markets cool and investment returns drop from double to single digit, bond management companies will look attractive again.
"From the M&A side, fixed income has been a quiet sector. There hasn't been great demand from buyers for bond companies and the smaller, midsize firms haven't grown much in recent years," he said.
But once investors begin to anticipate more moderate returns from equity investments, the bond business will revive and the value of bond firms will improve, Mr. Holt said.