Beyond the green bond: a sustainable future for IG credit? – Candriam

A sustainable plan for investing in European investment grade credit.

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... The ‘greenium’, or premium sometimes demanded by the market for green bonds, is modest – only a couple of basis points. This means that held to maturity and assuming the same default risk, there is no reason why a sustainable bond universe should not provide the same return as the broader Euro investment grade credit market.

New transparency regulations in Europe, taken together, are a game-changer for Euro investment grade bonds. Candriam expect this will raise the interest in sustainability, but will also increase the need for in-depth fundamental credit analysis, careful pricing of risks.

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