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Investors are pouring into investment grade corporate, high yield and emerging market bonds as they search for regular dividends. But they would be well advised to proceed with caution

High yield funds have had an impressive year so far with investors drawn to their high levels of returns compared to equities and government bondsHigh yield funds have had an impressive year so far with investors drawn to their high levels of returns compared to equities and government bonds

Yerlan Syzdykov, Pioneer

Flows into emerging market bonds remain healthy despite low yields and worrying signs that China’s growth is slowing, but some fear investors will flee these markets if the good times come to an end

US markets have performed well over the past year, but there are worries that they do not accurately reflect the state of the country’s economy

The increasingly diverse performances of different commodities is forcing fund managers to go overweight on those they feel will outperfom

The safe but unspectacular yields from higher grade corporate bonds continue to attract those looking for defensive investments, but the more adventurous are turning to the generous returns offered by lower grade issuers

Capital values in commercial property have fallen, but yields remain high and prime locations continue to attract investors

With low interest rates set to continue and the threat of further regulation just over the horizon, the future continues to look bleak for money market funds

Gaby Gourgey, MFS Meridian Funds European Equity

Worries over the eurozone remain, but European equities are attractively priced, while many of the continent’s large cap companies are well-positioned to make major inroads into emerging Asia

While stockmarkets in China and Hong Kong fell significantly during 2011, few have lost faith in the long-term Asian growth story

Nathan Bance, Barclays Capital

ETFs continue to go from strength to strength, with investors wary of high active management fees attracted by the flexibility and breadth of coverage of these passive products

It is hard to find a silver lining in the current climate, but for the exchange traded fund (ETF) industry at least, the economic backdrop has helped boost inflows because ETF charges are low and do not obliterate low investment returns, and their extreme liquidity is helpful during current market volatility.

Most commentators believe that high yield bonds offer significant opportunities to investors as they have priced in a worst-case scenario that is unlikely to occur

The US maybe suffering from slowing growth and worries over the national debt but falling equity prices are creating opportunities for adventurous stock pickers

Benjamin Conquet, BNP Paribas Investment Partners

The all time highs enjoyed by corporate bonds over the past couple of years may be over, but the sector still offers attractive yield-based returns

Increasing demand for commodities over the long-term seems assured, but fears over a slowing global economy are leading to extremely volatile prices.

James Lloyd, Mayfair-Capital Investment Management

Although property valuations in prime locations have recovered, they have yet to return to pre-crisis levels, creating opportunities for those looking to invest in the sector .

Clients of liquidity funds are increasingly demanding active management of their portfolios to achieve a balance between safety and performance

Investors have been largely underweight European equities of late, but inflows are improving with optimism driven by strong earnings growth in the North. However, there are worries that this may not be a long-term trend, writes Ceri Jones

Emerging market equities have enjoyed stellar growth in recent times, but with problems such as rising inflation on the horizon, opinion is divided about whether this growth is set to continue. Ceri Jones reports

Emerging market growth is an easy story for asset managers to sell, making it child’s play to launch funds and raise money. This in itself is enough to make some wealth managers cautious.

Wealth managers are increasingly turning to passively managed portfolios as part of their offering to clients, with ETFs at the core. Ceri Jones reports.

Flows into high yield bonds remain steady as the asset class continues to appeal to investors attracted by improved corporate fundamentals and the promise of low default rates. Ceri Jones reports.

Matt Ryan, MFS

Flows into emerging market debt have been steadily increasing,writes Ceri Jones, with institutional investors in particular attracted by strong economic fundamentals and the reduced levels of volatility that bonds offer over equities.

Adrian Brass, Fidelity

Uncertainty over whether we are in a double dip recession or a mid-cycle slowdown is spooking the markets, but the valuations of solid US companies are extremely attractive to investors. Ceri Jones reports.

Joanne Warner, First State

As government stimulus packages draw to a close, commodity prices have fallen, and continued demand from the emerging markets, and China in particular, is of increasing importance to the sector. Ceri Jones reports.