All Fixed Income articles – Page 110
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White papers
Are High Yield Investors Being Compensated for Risks?
In the context of today’s fundamental backdrop and default outlook, spread levels suggest investors are being fairly compensated, relative to other points in the cycle, for the amount of risk they are taking.
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White papersThe Fed Cuts Rate, But The Market Expects More
The Fed cut rates, but the market expects more: As expected the Federal Reserve lowered its target range for the Federal Funds rate by 25 basis, and now the market anticipates as many as three more cuts by the end of 2020. We think that is too much. In our view, the Fed is likely to pause to monitor the effects of the rate cuts on the economy, before acting again.
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White papersYour Questions Answered by Hermes Multi Strategy Credit
Your Questions Answered: a quarterly Q&A series featuring the top 10 questions that clients and prospective clients ask our investment teams.
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White papersQ4 Economic Outlook: Learning To Live With Deflation...
In his latest Economic outlook, Neil Williams, Senior Economic Adviser to Hermes Investment Management, argues that Japan-style deflation is becoming an increasing possibility elsewhere. While it may not involve a general downturn in living standards – Japan after all remains a prosperous G3, $5trn economy (almost twice the UK’s) – the main challenge would be the shift in mind-set needed to live with it.
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White papersFlexible credit: strategies for all seasons
A flexible, all-weather approach to credit investing has risen in popularity during the past decade. In the first instalment of a five-part series, we look at how flexibility has helped credit investors capture income in a low-yield world and manage duration risk. In an uncertain and often volatile environment, we consider what a flexible approach can offer investors at this stage of the macroeconomic cycle, and throughout the next.
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White papersLeaders’ Perspectives: Quarterly – Autumn 2019
In the Autumn 2019 issue of the Leader’s Perspectives:
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White papersIlliquidity: understanding the premium in fixed-income markets
Years of low interest rates have prompted fixed-income investors to look beyond traditional sources of yield and consider whether illiquid assets can boost returns. But while this illiquidity premium is widely discussed and increasingly sought, it has been inadequately measured and investors lack an understanding of how it operates in different conditions.
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White papersNuveen knows income - Securitized bonds: investment potential in a complex market
We think securitized credit may offer attractive risk-adjusted returns, but this complex market requires experienced, in‑depth analysis
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White papersDistressed Debt: Seeking Opportunity in Choppy Waters
Investors are increasingly looking to distressed debt as the credit cycle matures. But with a competitive landscape and significant growth in private credit and European high yield, this cycle could look different than those of the past. Stuart Mathieson, Head of Barings’ Global Special Situations group, and Bryan High, Co-Portfolio Manager of the strategy, discuss how the macro environment is impacting their outlook, and where they’re seeing opportunities today.
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White papers
Fed And Ecb, Bridging From A “Mid-Cycle Adjustment” To An “Impactful And Significant” Package.
The minutes from the latest ECB meeting suggest that the ECB is likely to proceed with a full set of measures in September, confirming not only the indications from President Draghi following the meeting but also the very latest statements by Olly Rehn, calling for the need for an “impactful and significant” package.
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White papersAsset Class Return Forecasts - Q3 - 2019
We expect economic growth to evolve around potential for most developed economies in 2020. It could subsequently decrease below potential in 2021 driven by a deteriorating cyclical environment and still anaemic global trade. Nevertheless, growth should stay in positive territory.
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White papersEmerging Markets Charts & Views - Q3 2019
The recent dovishness from the Fed, a benign inflation environment and the easing in global financial conditions continue to support a goldilocks environment for Emerging Markets (EM) assets. On the risks side, trade disputes appear to be softening as we approach the US presidential campaign. But the existing tariffs are weighing on the corporate earnings, with mixed prospects across regions as some countries are also benefitting from a restructuring of the global supply chain.
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White papersSeek High Yield Opportunities, but be aware of liquidity conditions
Speculative grade bonds have been among the major beneficiaries of the rapid turn of both Fed and ECB monetary policy stances to much more dovish positions. Lower rates for longer and more synchronised easing mean much lower funding costs and easier financial conditions for HY companies, which, as we know, are more sensitive than IG companies to the absolute levels of nominal and real rates.
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White papersMarket Risk Insights: objective danger in the investment environment
Markets may have reached record peaks earlier this year, but the geopolitical environment is fraught and central-bank oxygen may not prop up asset prices for much longer. We expect more outbursts of pent-up volatility going forward as investors face up to the growing risks in this high-altitude market.
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White papersAre Distressed Small Banks Putting China’s Banking System at Risk?
It’s been 20 years since a Chinese bank failed. But recent bailouts of three regional lenders have raised concerns about systemic problems in China’s financial sector. While risks have grown for China’s smaller banks, we believe that the Chinese banking system remains robust.
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White papers
U.S. Loans: Challenged Market or Veiled Opportunity?
With loan and bond yields currently comparable, we believe—in a somewhat contrarian view to the market—there is a good argument for investing in loans, particularly in the U.S., where the economy appears to be marginally stronger than in Europe.
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White papers360° – Fixed Income report, Q3 2019
The protracted injection of liquidity into the fixed-income space over the past decade has resulted in more than $14tn-worth of negative-yielding debt. In today’s upside-down world, a flexible approach will help credit investors keep an active watch and avoid potential pitfalls.
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White papersDon't Panic - Just Yet - How to navigate the buoys and the rocks of today’s markets.
There’s a moment that sends a chill down the spine of any sailor when a rock suddenly appears, off wrong side of the bow. It doesn’t really matter whether the chart was wrong or the skipper missed a buoy—it’s undeniably a sign of trouble.
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White papersDistressed Debt: How This Cycle May Be Different
Barings’ Stuart Mathieson and Bryan High discuss the outlook and competitive landscape for distressed debt and consider the implications of the significant growth in private credit and European high yield since the last cycle.
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White papersWhat do negative interest rates mean for investors?
With interest rates falling sharply, even more sectors of the global bond market are trading in negative territory. We explain what this means for investors, offer perspective on where markets may be headed and suggest strategies to position portfolios to preserve income and protect against losses.
