Fixed Income – Page 55
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White papersStrategic Relative Value – Q1 2020
Persistent central bank liquidity and easing geopolitical tensions should support a continued rally in risk assets this year. However, the significant disconnect between elevated valuations and only modest economic growth means risk assets are vulnerable to a deterioration in sentiment so investors should also maintain some defensive positioning.
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White papersOn My Mind: Oops! They Qe’d Again
The US Federal Reserve (Fed) has expanded its balance sheet by about $400 billion since last September. This has reversed more than half of the balance sheet unwinding (about $700 billion), which the Fed had started in October 2017.1 A growing number of analysts and investors have concluded that the Fed is once again engaged in quantitative easing (QE). The Fed denies it.
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White papersFlexible credit: six drivers of conviction
What are the key determinants of an active credit fund manager’s decision to invest? From curve and convexity through to sustainability and sizing, we assess six drivers of conviction.
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White papersWhy fixed-income investors should factor sustainability into investment decisions
Why should fixed-income investors factor sustainability into their investment decisions, and what are the approaches available to them? What drives an impactful engagement with a credit issuer? These are some of the key questions that our clients and prospective investors ask about ESG and engagement in fixed-income markets.
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White papersEconomic Resilience, Fed And Elections To Drive Us Markets In 2020
2019 proved a strong year for US assets, with US equity markets recording the strongest annual total return since 2013 and the US aggregate bond index up almost 9.0%. In addition, the past decade proved the best ever for the S&P 500 index, which returned 256% overall, well above its historical average. It was also the decade when US equities dominated other markets, with an outperformance of more than 90% versus the MSCI World index.
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White papersMulti-asset allocation views: The pros and cons of higher-yielding fixed income
Sunil Krishnan asks whether higher-yielding fixed income assets remain good diversifiers for multi-asset portfolios in the current environment.
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White papersBlog: Emerging market fixed income – the outlook
Despite a sometimes challenging environment, emerging market debt generated strong returns in 2019. All four principal emerging market debt categories generated double-digit returns in 2019, led by hard currency emerging market debt.
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White papersBlog: Investing for tomorrow – applying ESG principles to emerging market debt
In the past, investors often balked at the idea of applying environmental, social and governance (ESG) criteria when investing in emerging markets. We believe such an attitude is based on outdated associations of low income with political, social or economic disadvantages. Many EM countries have undergone significant progress and now have middle-income status.
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White papersBlog: China themes for 2020 – growth and policy (2/2)
What to expect economically from superpower China in 2020? In the final part of this two-part series, senior economist Chi Lo discusses the outlook for inflation, growth and central bank policy.
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White papersCredit selectivity at the fore in European high yield bond and senior loan investing
The European leveraged finance market is recognised for its potential to offer a compelling income advantage versus other, more traditional fixed income asset classes. Current market factors such as low default rates for speculative-grade debt and further stimulus from the European Central Bank are expected to continue to lend support to this asset class, which has enjoyed strong performance in 2019. Still, a prudent perspective would view the market as standing on relatively fragile ground in a period of low yields, lackluster economic activity and weakening growth outlook.
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White papersA supportive environment for investment grade credit
The macro environment we face is one of low economic growth, low inflation, and loose monetary policy. That can be considered something of a sweet spot for investment grade credit. Corporate earnings are strong enough for the moderate leverage in the asset class, and investors’ search for high-quality yield supports bond prices.
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White papersEmerging market debt rally set to moderate
Emerging market (EM) debt started 2019 at attractive valuations. This followed a nine-month slide as the US Federal Reserve moved to normalise monetary policy and raise interest rates, which naturally strengthened the dollar and increased EMs’ funding costs.
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White papersBuilding on 2019’s green bond resurgence
In almost whatever country you care to mention, climate change and social inequality are exploding into the public consciousness. Extinction Rebellion in the UK or the Gilets Jaune in Paris are just two of the more high-profile signs. Yet in the financial markets, too, green, social and sustainability bonds are growing in number and sophistication.
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White papersQuality is key in a slow economy
The outlook for Europe’s high yield market was getting darker as we moved into 2019. Third quarter earnings reports at the end of 2018 had mostly missed expectations, industrial activity was slowing and world markets had just suffered a sharp sell-off. Like most others, we were expecting returns for 2019 to be only moderately positive or even flat.
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White papersImpact investing in public fixed income markets
Across Nuveen, our commitment to responsible investing (RI) is based on three core principles:(1) integration of environmental, social and governance (ESG) factors into our investment processes and decision-making; (2) proactive engagement with issuers and other industry stakeholders on a variety of ESG-related topics; and(3) impact, the ability of our investment practices to deliver competitive financial performance and document the intended environmental and social outcomes.
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White papersFixed Expense Investing
Low and even negative yields have turned some fixed income investing into “fixed expense” investing—but there are still good reasons to hold negative-yielding bonds.
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White papersDecember Macro Dashboard
The announced Phase One trade deal between the U.S. and China, as well as the Conservatives increasing their majority in the U.K. election, has tempered two of the biggest political risks hanging over the global economy. At least temporarily, sentiment is turning optimistic.
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White papersA class apart: emerging Asia’s fixed income market
Why investors seeking a stable and attractive source of return within a diversified bond portfolio should head to emerging Asia.
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White papersFixed Income: Back To Core - Charts And Views
The ongoing slowdown in global trade will weaken global GDP growth further in 2020 – especially in advanced economies skewed towards the manufacturing sector – but a full-blown recession is unlikely, in our view. This situation will encourage policymakers to finally add fiscal stimulus to the policy mix, possibly extending the economic and credit cycles. Monetary policy is unlikely to become much more accommodative and market expectations will have to adjust, likely driving bond volatility higher with a possible bottoming out of core bond yields.
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White papersMitigating Inflation Risk at Lower Opportunity Cost
Inflation-mitigating allocations can drag on returns when inflation is subdued: diversifying and tactical allocation can help.
