Fixed Income – Page 16
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White papers
How to think about bonds in this new world
After the global financial crisis (GFC) in 2008, investors reduced their allocation to bonds, and broadly remained underweight the asset class for more than a decade. In 2022, the long period of accommodative central bank policy came to an end as inflation accelerated.
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White papers
Shorter versus longer-dated bonds: Is there a role for both in investor portfolios?
Money market and short-dated (one-to-five-year) bond yields are the highest they have been since the end of the 2008/2009 global financial crisis.
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White papers
Global inflation: Have deflationary forces subsided?
Global inflation continues to gradually cool, helped by lower energy prices and the impact of tighter monetary conditions. However, getting inflation back to 2% on a sustained basis could prove more difficult and depend on whether longer-term deflationary forces are able to re-assert themselves.
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Macro Perspectives: Diverging views on the economic path
Are current US market dynamics “too hot, too cold or just right?” What are the impacts of rising interest rates? What is the case for diversification? Our economists discuss these questions in our latest Macro Perspectives.
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A view on Italy and its government debt
On 20 October, S&P Global Ratings announced that it was keeping its rating of Italian debt unchanged with a stable outlook. The rating agency’s decision kicks-off a wave of autumn credit assessments and will be followed by DBRS Morningstar on 27 October, Fitch Ratings on 10 November and finally Moody’s on 17 November
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White papers
Doing good and doing well: Our approach to sustainable fixed income
What are the core principles of sustainable investing, why does it make sense in this environment, and what kind of companies do we look to invest in? Mitch Reznick, Head of Sustainable Fixed Income, shares the team’s view.
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White papers
No Regrets: The ECB Keeps Policy on Hold
Inflation in the euro area is falling and the economy is rapidly weakening. Against that background, the ECB kept rates on hold at its policy meeting on October 26.
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Are Higher Fixed Income Allocations Warranted Today?
In this note, we compare the equity/fixed income efficient frontier of today with that of 2021. We find that higher bond allocations may help investors pursue long-term return objectives with lower risk.
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White papers
Fixed income: a bull steepener as rates peak?
In past market cycles, yield-curve inversions like the one seen this year have almost always been followed by an episode of bull steepening, when short-term interest rates fall faster than those in the long term. In this issue of Alphorum, we consider the most likely yield-curve scenario from here and how it informs our positioning.
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White papers
Investing in alternative credit: perspectives on opportunities and risks
Even as traditional fixed income yields appear more attractive, institutional investors continue to explore alternative credit asset classes as a way to potentially improve the risk/return profile of their portfolios.
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White papers
Treasury yields rise, anticipating a Fed pause
The U.S. Treasury yield curve steepened as the U.S. Federal Reserve indicates a pause at the November meeting. The market has essentially priced out any chance of a November hike and is pricing in only a 20% likelihood of a December rate increase.
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White papers
Not all high yield is created equal
The high yield bond market has matured from its humble beginnings and is now a diverse $1.793bn marketplace for companies to achieve their capital financing needs. As it has matured, its credit quality has also increased. Today, nearly half of the high yield market is classified as BB – the highest quality credit rating. At the same time, the proportion of the weakest credits has also reduced.
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White papers
Quarterly fixed income perspectives 4Q 2023: Recession takeoff delayed but not canceled
While the timing of a recession remains uncertain, unique opportunities exist for fixed income investors as we head into the final quarter of 2023.
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White papers
Central banks’ endgame: a new policy paradigm
”Investors will need to adjust to a paradigm shift away from the accommodative policy stance that has supported financial asset prices, to an environment that should make bonds more attractive while increasing the risk-adjusted required returns for other major asset classes.”
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White papers
Sovereign Fixed Income: An update on our ESG scores
In their latest publication, Templeton Global Macro takes a closer look into renewable energy and the impact of advances in this space, especially for emerging market countries.
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Tighten Your Seatbelts
Shifting supply-and-demand dynamics appear to be driving bond markets more than fundamentals, which makes for a bumpy ride.
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Planning for long term success in emerging market debt
The fast-paced evolution of EMD as an asset class necessitates an investment approach that can adapt swiftly. In this Q&A, emerging market debt (EMD) portfolio manager Kirstie Spence discusses how to plan for the long-term success of managing the asset class.
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White papers
Position portfolios for a policy turn
While it is tempting to sit in still high yielding cash, we suggest adding traditional fixed income sectors. Higher income helps investors wait for the end of the rate hiking cycle, and longer duration helps position a portfolio for potential rate declines. We advocate a diversified multisector approach, focused on higher-quality credits across sectors. Active management remains critical, as credit spreads will likely widen in the coming months.
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White papers
Credit Roundtable: What Comes Next for Corporate Credit?
Do liquidity walls pose a danger to credit markets? While both investment grade and high yield defaults have remained mild, are these numbers expected to stay low? Katie Klingensmith, Bill Zox and Andrew Bogle (Brandywine Global) discuss the outlook for corporate credit.
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White papers
A bond market bruising: market snapshot
The yield on global government bonds reached multi-decade highs this week, as markets adjust to a sustained period of higher interest rates.