As the outlook for UK interest rates begins to loom large on the investment agenda, Ben Funnell, Portfolio Manager of the Man Dynamic Allocation Fund, comments: "Much has been said in recent days about the outlook for UK interest rates. Derivatives markets are implying that there will be at least one cut from the Bank of England in 2020. Overnight Index Swaps are currently pricing 0.46 percent by year end, from the current target of 0.75 percent.

"Nonetheless, we think gilt yields will rise from here post the election result for other reasons. Labour party Leader Jeremy Corbyn recently said that even though Labour had lost the election, they had won the argument. He has a point: austerity is over.

"The Conservative manifesto effectively promises an additional £100 billion of capital spending over the next five years, around 5 percent of GDP. Only £22 billion of this has so far been allocated to specific projects.

"Our expectation is that the rest of this money will be spent in short order as [Prime Minister] Boris [Johnson] seeks to consolidate the many post-industrial ‘left behind' seats he won. In this scenario we don't think the government will have ten-year money at 66 basis points for too long.

"As we start the year, we therefore believe bonds are still expensive, and with growth set to improve further we remain underweight the asset class."

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As the outlook for UK interest rates begins to loom large on the investment agenda, Ben Funnell, Portfolio Manager of the Man Dynamic Allocation Fund, comments: "Much has been said in recent days about the outlook for UK interest rates. Derivatives markets are implying that there will be at least one cut from the Bank of England in 2020. Overnight Index Swaps are currently pricing 0.46 percent by year end, from the current target of 0.75 percent.

"Nonetheless, we think gilt yields will rise from here post the election result for other reasons. Labour party Leader Jeremy Corbyn recently said that even though Labour had lost the election, they had won the argument. He has a point: austerity is over.

"The Conservative manifesto effectively promises an additional £100 billion of capital spending over the next five years, around 5 percent of GDP. Only £22 billion of this has so far been allocated to specific projects.

"Our expectation is that the rest of this money will be spent in short order as [Prime Minister] Boris [Johnson] seeks to consolidate the many post-industrial ‘left behind' seats he won. In this scenario we don't think the government will have ten-year money at 66 basis points for too long.

"As we start the year, we therefore believe bonds are still expensive, and with growth set to improve further we remain underweight the asset class."