November Figure 1: New issuance (US$ billion) presents attractive opportunities

Save this PDF as:
 WORD  PNG  TXT  JPG

Size: px
Start display at page:

Download "November 2012. Figure 1: New issuance (US$ billion) presents attractive opportunities"

Transcription

1 November 2012 Emerging market corporate bonds attractive opportunities in a dynamic sector In a world where traditional fixed income investments, such as core government bonds, offer very low returns to investors, interest in emerging market (EM) corporate bonds has grown rapidly, and we expect this trend to continue. A number of factors are fuelling investor demand, including: Zara Kazaryan Fund Manager The opportunity to lock in a relatively high yield and to benefit from the sector s excellent potential for capital growth. The increasing depth and breadth of the asset class, which is already bigger than the EM sovereign debt sector. The strong financial health of EM corporates revenues are growing rapidly while average net leverage is declining. The accelerating growth of a dynamic and diverse asset class EM corporate debt provides investors with the opportunity to diversify into a new, dynamic and growing sector, which we believe remains undervalued and far less well-known than other financial markets. With a lower profile than the separate asset class of sovereign EM bonds, the potential of the EM corporate debt sector has been developing in the past few years. Figures on new issuance highlight the sector s dynamism and underline the wealth of new opportunities that are emerging (see Figure 1 below). Figure 1: New issuance (US$ billion) presents attractive opportunities Source: JP Morgan. (1) 2H, 2012 EM corporate debt new issuance forecast. Page 1 of 5

2 External corporate debt new issuance by EM companies increased from US$58bn in 2008 to US$202bn in 2011; whilst US$310bn of new EM corporate issuance is forecast for 2012, with Asia and Latin America leading the way. Investment grade issuers, which constitute around 75% of new issuance, are driving the record pace of activity seen in The surge in companies coming to the market is further increasing the diversity of issuers across a large range of sectors and countries. The EM corporate bond index is now larger than the sovereign index (see Figure 2 below) and this gap is likely to widen. This is because there is clearly a ceiling on the number of countries in the EM universe, while the potential number of quality corporates coming to the market is vast. Figure 2: Corporate EM bond universe overtakes sovereign bonds in size Dec 01 Jun 03 Dec 04 Jun 06 Nov 07 May 09 Nov 10 May 12 CEMBI Broad EMBIG Source: JP Morgan Factors fuelling the growth of the asset class A number of factors (on both the supply and demand side) are fuelling the dynamism of the sector. Emerging economies continue to grow at a rapid pace overall and are increasingly urbanised, while external reserves are also rising dramatically. As the underlying economies develop, more and more corporates are reaching a position where they can come to the market and issue public debt. In addition, as a result of the Basel III regulations, banks are less willing and/or able to lend to corporates. Although bank lending is still very significant, the availability of loans has been affected and that has forced a large number of very high quality companies to diversify their funding sources and turn to public debt markets, whether external or local (This viewpoint is focused on hard currency EM corporate bonds as opposed to local currency issues). Moreover, the continuing European debt crisis, low growth rates and near-zero interest rates in the developed world have led investors to favour emerging markets. Meanwhile, growing interest in the corporate debt sector in the emerging world is boosting liquidity and depth in this market. The growing number of investors attracted to the sector has had Page 2 of 5

3 (US$ million) a beneficial effect on yields from the borrower s point of view - companies are able to raise finance at lower rates than was previously the case as demand for these bonds has increased. Large corporates prefer the greater flexibility provided by hard currency bonds which allows them, for example, to become involved in longer-term projects with higher capital expenditure requirements. Superior fundamentals remain undervalued Over the last decade, EM corporate debt has evolved from a small and risky asset class into a sector with superior fundamentals, improving corporate governance, relatively high liquidity and credit ratings upgrades. Today, EM corporates in debt capital markets have significant cash cushions, healthy leverage levels and steadily growing revenues and EBITDAs (Figure 3 and 4). However, this is yet to be fully reflected in their credit ratings and in investor perceptions of the underlying risks/reward profiles. Figure 3: The strong and improving health of EM corporates 3,500 3,000 2,500 2,000 1,500 1, Q09 +50% 4Q05 2Q06 4Q06 2Q07 4Q07 2Q08 4Q08 2Q09 4Q09 2Q10 4Q10 2Q11 Source: JP Morgan. September 2012 As Figure 4 overleaf demonstrates, leverage is much lower, on average, among EM corporate debt issuers than their counterparts in the developed world. Yet, EM corporates tend to have lower ratings than their developed market peers. Moreover, while similar companies are rated differently, EM corporate debt sectors pay higher yields than the equivalent in the developed world. These disparities create opportunities, which investors can exploit before they are appreciated by the wider market. We believe that these yield differentials will disappear in the short term since they clearly do not reflect fundamentals in terms of asset quality. Page 3 of 5

4 Figure 4: The health of the EM corporates is yet to be reflected in the ratings and yields (1) Source: Fitch Ratings; S&P as at 31 July 2011 (latest available data). (2) Source: EM HY Corp = JPM CEMBI Broad Diversified High Yield Index, EM IG Corp = JPM CEMBI Broad Diversified Investment Grade Index, US HY Corp = Merrill Lynch US High Yield Master II Index, US IG Corp = Merrill Lynch US Corporate Master Index, EM Sov= JPM EMBI Global Diversified Index, US Govt = Merrill Lynch US treasury Master Index EM corporate debt asset class outlook Looking to the longer term, the sector should benefit from the faster growth of emerging economies compared to their developed counterparts, and the rapidly growing number of EM corporates that are reporting very good earnings and issuing debt to finance their expansion. The asset class should thus benefit from a further improvement in credit quality, further yield compression and a continuing increase in diversity. In addition, the stability of the sector will continue to improve as more and more funds benchmarked to the EM Corporate Bond Index are launched. Currently, a significant proportion of investors are attracted to the asset class by its superior yield and they tend to leave the sector when risk aversion rises. But funds benchmarked to the index continue to invest in the index during periods of turbulence, thus providing support. Thus, as the number of benchmarked funds rises, volatility should decline. Indeed, the effect is already becoming apparent. Given the continuing problems in the eurozone, the looming US fiscal cliff and the global slowdown, for example, one might expect to see considerable volatility among EM corporate debt. However, we are actually seeing large inflows into the sector, which is also gaining support from other positive factors, namely: income seeking investors have few other options; and emerging economies continue to grow as their developed counterparts languish under the weight of hefty debt burdens. In conclusion, investing in EM corporate bonds does entail risks, including relatively high levels of volatility and the limited coverage of certain issuers. At the same time, the diversity of the asset class, pricing inefficiencies and its growth potential provide significant alpha generation opportunities for active managers. Meanwhile, the stability of the market is improving as the number of benchmarked funds grows, and the range and depth of the market rapidly increases. The market is already seeing large inflows and a number of investors may decide that now is a good time to invest before its attractions are fully appreciated (and priced in) by the wider market. Page 4 of 5

5 Important information For Investment Professionals use only, not to be relied upon by private pension funds. Past performance is not a guide to the future. The value of investments and any income from them can go down as well as up. This material is for information only and does not constitute an offer or solicitation of an order to buy or sell any securities or other financial instruments, or to provide investment advice or services. The research and analysis included in this document has been produced by Threadneedle Investments for its own investment management activities, may have been acted upon prior to publication and is made available here incidentally. Any opinions expressed are made as at the date of publication but are subject to change without notice. Information obtained from external sources is believed to be reliable but its accuracy or completeness cannot be guaranteed. Issued by Threadneedle Asset Management Limited. Registered in England and Wales, No Registered Office: 60 St Mary Axe, London EC3A 8JQ. Authorised and regulated in the UK by the Financial Services Authority. Issued in Hong Kong by Threadneedle Portfolio Services Hong Kong Limited ("TPSHKL"). Registered Office: Unit 3004, Two Exchange Square, 8 Connaught Place, Central, Hong Kong. Registered in Hong Kong under the Companies Ordinance (Chapter 32), No Authorised and regulated in Hong Kong by the Securities and Futures Commission. Please note that TPSHKL can only deal with professional pension funds in Hong Kong within the meaning of the Securities and Futures Ordinance. The contents of this document have not been reviewed by any regulatory authority in Hong Kong. You are advised to exercise caution in relation to the offer. If you are in any doubt about any of the contents of this document you should obtain independent professional advice. Issued in Singapore by Threadneedle Investments Singapore (Pte) Limited, Winsland House 1, 3 Killiney Road, Singapore Any Fund mentioned in this document is a restricted scheme in Singapore, and is available only to residents of Singapore who are Institutional Pension funds under Section 304 of the SFA, relevant persons pursuant to Section 305(1), or any person pursuant to Section 305(2) in accordance with the conditions of, any other applicable provision of the SFA. Threadneedle funds are not authorised or recognised by the Monetary Authority of Singapore (the MAS ) and Shares are not allowed to be offered to the retail public. This document is not a prospectus as defined in the SFA. Accordingly, statutory liability under the SFA in relation to the content of prospectuses would not apply. Threadneedle Investments is a brand name and both the Threadneedle Investments name and logo are trademarks or registered trademarks of the Threadneedle group of companies. This material includes forward looking statements, including projections of future economic and financial conditions. None of Threadneedle, its directors, officers or employees make any representation, warranty, guaranty, or other assurance that any of these forward looking statements will prove to be accurate. Issued in the US by Threadneedle International Limited ( TINTL ), a U.K.-based investment management firm provides financial services to individual and institutional pension funds. TINTL is registered as an investment adviser with the U.S. Securities and Exchange Commission and is authorised and regulated in the conduct of its investment business in the UK by the UK Financial Services Authority. Page 5 of 5

European debt crisis essay wins scholarship for German student

European debt crisis essay wins scholarship for German student MEDIA RELEASE THREADNEEDLE ANNOUNCES SCHOLARSHIP PRIZE WINNERS European debt crisis essay wins scholarship for German student LONDON 27 SEPTEMBER: German student Caroline Duong has won the 2011 Threadneedle

More information

Strength Across the Board Investment Excellence in Fixed Income 30 June 2015

Strength Across the Board Investment Excellence in Fixed Income 30 June 2015 Strength Across the Board Investment Excellence in Fixed Income 30 June 205 Recognising the strength and depth of our Fixed Income range across Europe, the US and Emerging Markets CLASS I EUR Performance

More information

Emerging Markets Fixed Income Capabilities

Emerging Markets Fixed Income Capabilities For professional investors Fixed Income Capabilities Opportunities in a market benefiting from strong fundamentals and increasing demand Fixed Income Capabilities I 2 BNP Paribas Investment Partners BNP

More information

A case for high-yield bonds

A case for high-yield bonds By: Yoshie Phillips, CFA, Senior Research Analyst AUGUST 212 A case for high-yield bonds High-yield bonds have historically produced strong returns relative to those of other major asset classes, including

More information

Product Key Facts. PineBridge Global Funds PineBridge Global Emerging Markets Bond Fund. 22 December 2014

Product Key Facts. PineBridge Global Funds PineBridge Global Emerging Markets Bond Fund. 22 December 2014 Issuer: PineBridge Investments Ireland Limited Product Key Facts PineBridge Global Funds PineBridge Global Emerging Markets Bond Fund 22 December 2014 This statement provides you with key information about

More information

ABF PAN ASIA BOND INDEX FUND An ETF listed on the Stock Exchange of Hong Kong

ABF PAN ASIA BOND INDEX FUND An ETF listed on the Stock Exchange of Hong Kong Important Risk Disclosure for PAIF: ABF Pan Asia Bond Index Fund ( PAIF ) is an exchange traded bond fund which seeks to provide investment returns that corresponds closely to the total return of the Markit

More information

European high yield in 2015: a tale of two markets An M&G Investments Institutional briefing December 2015

European high yield in 2015: a tale of two markets An M&G Investments Institutional briefing December 2015 European high yield in 215: a tale of two markets An M&G Investments Institutional briefing December 215 Weakness in US high yield in the last months of 215 has highlighted the relative strength of the

More information

A case for high-yield bonds

A case for high-yield bonds By: Yoshie Phillips, CFA, Senior Research Analyst MAY 212 A case for high-yield bonds High-yield bonds have historically produced strong returns relative to those of other major asset classes, including

More information

Development of the government bond market and public debt management in Singapore

Development of the government bond market and public debt management in Singapore Development of the government bond market and public debt management in Singapore Monetary Authority of Singapore Abstract This paper describes the growth of the Singapore Government Securities (SGS) market.

More information

Recent Developments in Local Currency Bond Markets (LCBMs) 1. October 2013

Recent Developments in Local Currency Bond Markets (LCBMs) 1. October 2013 Recent Developments in Local Currency Bond Markets (LCBMs) 1 October 2013 Given the importance of local currency bond markets (LCBMs), including in the context of the work now underway on financing for

More information

Seeking a More Efficient Fixed Income Portfolio with Asia Bonds

Seeking a More Efficient Fixed Income Portfolio with Asia Bonds Seeking a More Efficient Fixed Income Portfolio with Asia s Seeking a More Efficient Fixed Income Portfolio with Asia s Drawing upon different drivers for performance, Asia fixed income may improve risk-return

More information

Viewpoints is a publication exclusively for institutional prospects, clients and consultants.

Viewpoints is a publication exclusively for institutional prospects, clients and consultants. Viewpoints September 2012 Large and broadly diversified market encompassing 39 countries and 352 issuers Fast-growing asset class now larger than the U.S. high yield bond market Generally higher yields

More information

Investor Guide to Bonds

Investor Guide to Bonds Investor Guide Investor Guide to Bonds threadneedle.com Introduction Why invest in bonds? Although your capital is normally considered safe in a traditional deposit account, low interest rates have eroded

More information

The Search for Yield Continues: A Re-introduction to Bank Loans

The Search for Yield Continues: A Re-introduction to Bank Loans INSIGHTS The Search for Yield Continues: A Re-introduction to Bank Loans 203.621.1700 2013, Rocaton Investment Advisors, LLC Executive Summary With the Federal Reserve pledging to stick to its zero interest-rate

More information

THE CASE FOR EMERGING MARKET CORPORATE BONDS October 2013

THE CASE FOR EMERGING MARKET CORPORATE BONDS October 2013 THE CASE FOR ERGING MARKET CORPORATE BONDS October 2013 THIS DOCUMENT IS FOR PROFESSIONAL CLIENTS AND INSTITUTIONAL/QUALIFIED INVESTORS ONLY. THE CONTENT IS NOT TO BE VIEWED BY, OR USED WITH, RETAIL INVESTORS.

More information

Fixed income benchmarks Time to think again?

Fixed income benchmarks Time to think again? February 2013 Fixed income benchmarks Time to think again? There are a number of drawbacks to the use of traditional fixed income benchmarks. As a consequence, some fixed income managers are reappraising

More information

HMT Discussion paper on non-bank lending

HMT Discussion paper on non-bank lending 17 February 2010 By e-mail to: non-banklending@hmtreasury.gsi.gov.uk Dear Sirs HMT Discussion paper on non-bank lending The IMA represents the UK-based investment management industry. Our members include

More information

Equity Sell-off Continues, Bonds Affected

Equity Sell-off Continues, Bonds Affected Equity Sell-off Continues, Bonds Affected Executive Summary Portfolio Performance So Far The 1-month performance of all model portfolios have been affected by the recent sell-off in equities, with returns

More information

in the eyes of global asset managers

in the eyes of global asset managers lakyara Japanese asset management business in the eyes of global asset managers Sadayuki Horie 13.May.2016 Executive Summary Sadayuki Horie Senior Researcher Financial Technology & Market Research Department

More information

Absolute return: The search for positive returns in changing markets

Absolute return: The search for positive returns in changing markets Absolute return: The search for positive returns in changing markets Tuesday, 7 June 2011 Portfolio Manager for Global Fixed Income and Absolute Return Funds www.dbadvisors.com Topics for discussion What

More information

The case for high yield

The case for high yield The case for high yield Jennifer Ponce de Leon, Vice President, Senior Sector Leader Wendy Price, Director, Institutional Product Management We believe high yield is a compelling relative investment opportunity

More information

Min. Investment Class A Units Initial: USD 1,000 Additional: USD 250

Min. Investment Class A Units Initial: USD 1,000 Additional: USD 250 Issuer: PineBridge Investments Ireland Limited Product Key Facts PineBridge Global Funds PineBridge Global Emerging Markets Bond Fund 22 February 2013 This statement provides you with key information about

More information

High-yield bonds have become a global opportunity

High-yield bonds have become a global opportunity By: Yoshie Phillips, CFA, Senior Research Analyst APRIL 2013 High-yield bonds have become a global opportunity Investors seeking income or attractive total return investments often look into high-yield

More information

Investment Strategy for Pensions Actuaries A Multi Asset Class Approach

Investment Strategy for Pensions Actuaries A Multi Asset Class Approach Investment Strategy for Pensions Actuaries A Multi Asset Class Approach 16 January 2007 Representing Schroders: Neil Walton Head of Strategic Solutions Tel: 020 7658 2486 Email: Neil.Walton@Schroders.com

More information

Legg Mason Western Asset Asian Opportunities Fund

Legg Mason Western Asset Asian Opportunities Fund PRODUCT KEY FACTS Legg Mason Global Funds Plc Legg Mason Western Asset Asian Opportunities Fund Issuer: Legg Mason Asset Management Hong Kong Limited January 2015 This statement provides you with key information

More information

The UK Retail Bond Market H1 2011 Performance Update

The UK Retail Bond Market H1 2011 Performance Update 1. Introduction The UK Retail Bond Market H1 2011 Performance Update Over the last 6 months, 7 transactions have been launched in the retail bond market in the UK, raising 540 million - with a further

More information

SACRS Fall Conference 2013

SACRS Fall Conference 2013 SACRS Fall Conference 2013 Bank Loans November 14, 2013 Allan Martin, Partner What Are Floating Rate Bank Loans? Senior secured floating rate debt: Current Typical Terms: Spread: LIBOR + 5.00%-6.00% LIBOR

More information

Fixed Income Overview

Fixed Income Overview Fixed Income Overview IDB: 27 October 2015 Liquidity in the Fixed Income Markets Demographics favouring fixed income assets More people retiring and living longer requiring income producing assets Source

More information

The Globalization of the High Yield Market:

The Globalization of the High Yield Market: The Globalization of the High Yield Market: Why Diversification Is An Increasingly Important Consideration In High Yield Investing The High Yield Team May 2013 The Globalization of the High Yield Market:

More information

High yield bonds. US senior loans update. required disclosures begin on page 4.

High yield bonds. US senior loans update. required disclosures begin on page 4. CIO WM Research 11 August 20 High yield bonds US senior loans update Barry McAlinden, CFA, strategist, UBS FS barry.mcalinden@ubs.com, +1 212 713 3261 Philipp Schöttler, strategist, UBS AG US loans experienced

More information

Investment insight. Fixed income the what, when, where, why and how TABLE 1: DIFFERENT TYPES OF FIXED INCOME SECURITIES. What is fixed income?

Investment insight. Fixed income the what, when, where, why and how TABLE 1: DIFFERENT TYPES OF FIXED INCOME SECURITIES. What is fixed income? Fixed income investments make up a large proportion of the investment universe and can form a significant part of a diversified portfolio but investors are often much less familiar with how fixed income

More information

Investment Bond. Funds key features. This is an important document. Please keep it safe for future reference.

Investment Bond. Funds key features. This is an important document. Please keep it safe for future reference. Investment Bond Funds key features. This is an important document. Please keep it safe for future reference. 2 WHAT ARE THE FUNDS KEY FEATURES? This document is part of the information we provide you to

More information

Latest developments in the international RMB market

Latest developments in the international RMB market Fourth Meeting of London Hong Kong RMB Forum 12 November 2014 The private-sector led London Hong Kong Forum to promote cooperation on the development of international renminbi (RMB) business (the Forum

More information

Managing Risk/Reward in Fixed Income

Managing Risk/Reward in Fixed Income INSIGHTS Managing Risk/Reward in Fixed Income Using Global Currency-Hedged Indices as Benchmarks In the pursuit of alpha, is it better to use a global hedged or unhedged index as a benchmark for measuring

More information

Growing opportunities in Emerging Markets corporate bonds

Growing opportunities in Emerging Markets corporate bonds March 214 Growing opportunities in Emerging Markets corporate bonds By Alexis De Mones Executive summary The Emerging Markets corporate bond debt universe is much larger and much more diverse than investors

More information

Monetary policy, fiscal policy and public debt management

Monetary policy, fiscal policy and public debt management Monetary policy, fiscal policy and public debt management People s Bank of China Abstract This paper touches on the interaction between monetary policy, fiscal policy and public debt management. The first

More information

Floating Rate Loans: An Attractive Yield Opportunity

Floating Rate Loans: An Attractive Yield Opportunity Floating Rate Loans: An Attractive Yield Opportunity Joseph Lynch portfolio manager Bank Loan Management Bond yields remain at record lows and the Fed continues to espouse policy to keep interest rates

More information

Harvesting bond returns as rates rise

Harvesting bond returns as rates rise November 214 For professional investors and advisers only. Harvesting bond returns as rates rise The climate is changing for fixed income. Quantitative easing is winding down. Interest rates look ready

More information

HIGH YIELD BONDS. 2015 Global Market Outlook Press Briefing

HIGH YIELD BONDS. 2015 Global Market Outlook Press Briefing 215 Global Market Outlook Press Briefing HIGH YIELD BONDS Mark Vaselkiv Portfolio Manager of the High Yield Fund and Institutional High Yield Strategy High Yield Bonds: Summary ENVIRONMENT U.S. high yield

More information

Securities Finance: Fixed Income & Repo Market Update

Securities Finance: Fixed Income & Repo Market Update MARKETS GROUP Securities Finance: Fixed Income & Repo Market Update Key Highlights from a Panel Discussion Fixed income and repo market participants are adapting to new regulations and fiscal realities

More information

Your investment choice. Zurich International Portfolio Bond

Your investment choice. Zurich International Portfolio Bond Your investment choice Zurich International Portfolio Bond Investment choice The Zurich International Portfolio Bond (the plan) is provided by Zurich Life Assurance plc (Zurich), a member of the Zurich

More information

An Overview of Offshore RMB Market. Nov 2013

An Overview of Offshore RMB Market. Nov 2013 An Overview of Offshore RMB Market Nov 2013 Contents 1. Outlook of RMB Internationalisation 2. Implications for Offshore RMB Bonds 2 Section 1 Outlook of RMB Internationalisation 3 RMB The next international

More information

High total returns and attractive income from bonds

High total returns and attractive income from bonds High total returns and attractive income from bonds Q&A roadshow 2016 #QAroadshow2016 Michael Scott Portfolio Manager June 2016 For professional advisers only. This material is not suitable for retail

More information

Diminished Liquidity in the Corporate Bond Market: Implications for Fixed Income Investors

Diminished Liquidity in the Corporate Bond Market: Implications for Fixed Income Investors Diminished Liquidity in the Corporate Bond Market: Implications for Fixed Income Investors 3/16/215 Summary In the wake of the 27-8 Financial Crisis, investors increased their holdings of fixed income

More information

European Credit: Seeking Symmetry From Senior to Subordinated Vianney Hocquet, Corporate Portfolio Manager

European Credit: Seeking Symmetry From Senior to Subordinated Vianney Hocquet, Corporate Portfolio Manager European Credit: Seeking Symmetry From Senior to Subordinated Vianney Hocquet, Corporate Portfolio Manager For Boston Investment Conference 2016 Attendees Only and Not to be Distributed to the Public Yield

More information

Jupiter Merlin International Equities Portfolio

Jupiter Merlin International Equities Portfolio Jupiter Merlin Funds Jupiter Merlin International Equities Portfolio Jupiter Asset Management Limited Product Key Facts April 2016 Product Key Facts This statement provides you with key information about

More information

DEBT MANAGEMENT OFFICE NIGERIA

DEBT MANAGEMENT OFFICE NIGERIA DEBT MANAGEMENT OFFICE NIGERIA MANAGING NIGERIA S DEBT STOCK Presentation at the Investor/Issuer Education Outreach Programme Organised by Securities and Exchange Commission on July 27, 2011 By Patience

More information

RBS Investment Options ICVC. Final Short Report. for the year ended 31 October 2014

RBS Investment Options ICVC. Final Short Report. for the year ended 31 October 2014 RBS Investment Options ICVC Final Short Report for the year ended 31 October 2014 RBS Investment Options ICVC Final Short Report Table of Contents Report of the Authorised Corporate Director 2 Economic

More information

JPMorgan Global Bond Fund. Global investing - A less volatile choice NEW. SFC-authorised global bond fund with RMB-hedged share classes*!

JPMorgan Global Bond Fund. Global investing - A less volatile choice NEW. SFC-authorised global bond fund with RMB-hedged share classes*! AVAILABLE FOR PUBLIC CIRCULATION NEW JPMorgan Global Bond Fund December 2015 Asset Management Company of the Year 2014 Fundamental Strategies, Asia + Important information 1. The Fund invests primarily

More information

Deutsche Bank 2014 Global Financial Services Investor Conference

Deutsche Bank 2014 Global Financial Services Investor Conference Connecting Markets East & West Deutsche Bank 2014 Global Financial Services Investor Conference Shigesuke Kashiwagi, CFO Nomura Holdings, Inc. May 28, 2014 Nomura Unique hybrid of retail brokerage/asset

More information

Separately managed accounts

Separately managed accounts FOR INSTITUTIONAL/WHOLESALE/PROFESSIONAL CLIENTS AND QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION Separately managed accounts A J.P. Morgan Global Liquidity solution Separately managed

More information

High-Yield Spread U.S. 10-Year Treasury Yield Investment Grade Spread

High-Yield Spread U.S. 10-Year Treasury Yield Investment Grade Spread WisdomTree ETFs BOFA MERRILL LYNCH HIGH YIELD BOND ZERO DURATION FUND HYZD The U.S. high-yield bond market has been one of the best-performing subsets of the fixed income investable universe over the past

More information

Understanding Fixed Income

Understanding Fixed Income Understanding Fixed Income 2014 AMP Capital Investors Limited ABN 59 001 777 591 AFSL 232497 Understanding Fixed Income About fixed income at AMP Capital Our global presence helps us deliver outstanding

More information

INFORMATION NOTE. The development of government bond market in Singapore

INFORMATION NOTE. The development of government bond market in Singapore INFORMATION NOTE The development of government bond market in Singapore 1. Background 1.1 Announced in the 2009-2010 budget speech by the Financial Secretary, the Government intends to implement a programme

More information

Fixed-income opportunity: Short duration high yield

Fixed-income opportunity: Short duration high yield March 2014 Insights from: An income solution for a low or rising interest-rate environment Generating income is a key objective for many investors, and one that is increasingly difficult to achieve in

More information

The return of yield to the high yield market

The return of yield to the high yield market FOR INSTITUTIONAL/WHOLESALE/PROFESSIONAL CLIENTS AND QUALIFIED INVESTORS ONLY NOT FOR RETAIL USE OR DISTRIBUTION The return of yield to the high yield market High yield credit November 215 AUTHORS IN BRIEF

More information

Leveraged Loan Funds: Debunking the Myths

Leveraged Loan Funds: Debunking the Myths Leveraged Loan Funds: Debunking the Myths SM Leveraged Loan Funds: Debunking the Myths Contents 2 Myth #1: Managing liquidity in actively managed leveraged loan mutual funds is difficult. 3 Myth #2: In

More information

Maturity The date where the issuer must return the principal or the face value to the investor.

Maturity The date where the issuer must return the principal or the face value to the investor. PRODUCT INFORMATION SHEET - BONDS 1. WHAT ARE BONDS? A bond is a debt instrument issued by a borrowing entity (issuer) to investors (lenders) in return for lending their money to the issuer. The issuer

More information

Holding the middle ground with convertible securities

Holding the middle ground with convertible securities January 2015» White paper Holding the middle ground with convertible securities Eric N. Harthun, CFA Portfolio Manager Robert L. Salvin Portfolio Manager Key takeaways Convertible securities are an often-overlooked

More information

GOVERNMENT OF SAINT LUCIA DEBT MANAGEMENT STRATEGY

GOVERNMENT OF SAINT LUCIA DEBT MANAGEMENT STRATEGY Page 1 of 5 Introduction GOVERNMENT OF SAINT LUCIA DEBT MANAGEMENT STRATEGY Debt management is the process of establishing and executing a strategy for managing the government s debt in order to raise

More information

Update Presentation with Larry Holzenthaler. January 2016

Update Presentation with Larry Holzenthaler. January 2016 Update Presentation with Larry Holzenthaler January 2016 Reminder Loans Have First Priority Loans have priority over Bonds, Preferred Shares, Common Equity Most senior tranche of the capital structure

More information

Santander Asset Management Focus on LATAM. Sao Paulo, May 2011

Santander Asset Management Focus on LATAM. Sao Paulo, May 2011 Santander Asset Management Focus on LATAM Sao Paulo, May 2011 2 Santander Asset Management advise that this presentation contains representations regarding forecasts and estimates. Said forecasts and estimates

More information

SHORT DURATION BONDS

SHORT DURATION BONDS SHORT DURATION BONDS Our Short Duration Bond Fund range RL Short Duration Gilt Fund RL Short Duration Global Index Linked Bond Fund RL Short Duration Credit Fund RL Duration Hedged Credit Fund RL Short

More information

Financial Repression: A Driving Force for Mergers and Acquisitions?

Financial Repression: A Driving Force for Mergers and Acquisitions? Strategy / Investment Financial Repression: A Driving Force for Mergers and Acquisitions? International capital markets have seen a growing number of corporate mergers and acquisitions (M&A) over the past

More information

The Coming Volatility

The Coming Volatility The Coming Volatility Lowell Bolken, CFA Vice President and Portfolio Manager Real estate Securities June 18, 2015 www.advantuscapital.com S&P 500 Percent Daily Change in Price September 2008 to April

More information

Impact of QE on Fixed Income

Impact of QE on Fixed Income Impact of QE on Fixed Income David Greene, Client Portfolio Manager Pioneer Investments Unconstrained Approaches Potential returns mean investors have to be more opportunistic 5 0 Expected return based

More information

Newton Global Dynamic Bond Fund

Newton Global Dynamic Bond Fund Newton Investment Management Newton Global Dynamic Bond Fund For professional investors only. This document is for Australian and New Zealand wholesale clients only. Please read the important disclosures

More information

Business Development Companies ( BDCs ) (A liquid alternative to private debt)

Business Development Companies ( BDCs ) (A liquid alternative to private debt) Business Development Companies ( BDCs ) (A liquid alternative to private debt) January 30, 2015 Business Development Companies, or BDCs, are exchange traded vehicles investing in private non-syndicated

More information

Important information on the main features of the Threadneedle Stockmarket ISA as at 1 November 2011

Important information on the main features of the Threadneedle Stockmarket ISA as at 1 November 2011 Important information on the main features of the Threadneedle Stockmarket ISA as at 1 November 2011 Key Features of the Threadneedle Stocks and Shares (Stockmarket) Individual Savings Account (B) Please

More information

The Credit Analysis Process: From In-Depth Company Research to Selecting the Right Instrument

The Credit Analysis Process: From In-Depth Company Research to Selecting the Right Instrument Featured Solution May 2015 Your Global Investment Authority The Credit Analysis Process: From In-Depth Company Research to Selecting the Right Instrument In today s low yield environment, an active investment

More information

Market Bulletin. November 7, 2014. U.S. High Yield: A bubble set to burst?

Market Bulletin. November 7, 2014. U.S. High Yield: A bubble set to burst? November 7, 2014 U.S. High Yield: A bubble set to burst? Grace Tam, CFA Vide President Global Market Strategist J.P. Morgan Funds Katy Fang Research Analyst J.P. Morgan Funds Tai Hui Managing Director

More information

The Emerging Markets fixed income universe

The Emerging Markets fixed income universe THE EMERGING VIEW August 13 The Emerging Markets fixed income universe By Jan Dehn The long-term case for investing in Emerging Markets (EM) is strong and rests on the arguments that these economies will

More information

HSBC Asian High Yield Bond Fund

HSBC Asian High Yield Bond Fund Important information: HSBC Asian High Yield Bond Fund (the Fund ) invests primarily in a broad range of higher yielding Asian fixed income securities and instruments. Investments of the Fund may include

More information

DYNAMIC DIVERSIFIED FUND

DYNAMIC DIVERSIFIED FUND DYNAMIC DIVERSIFIED FUND The Right Assets at the Right Time The SSgA Dynamic Diversifed Fund uses proven market-aware intelligence to dynamically adjust asset allocation ensuring you are in the right assets

More information

HSBC GLOBAL RESEARCH RUSSIA TRIP NOTES. Struggles with growth 1

HSBC GLOBAL RESEARCH RUSSIA TRIP NOTES. Struggles with growth 1 HSBC GLOBAL RESEARCH RUSSIA TRIP NOTES Struggles with growth 1 Russian economy is macroeconomically stable backed by broadly prudent fiscal and monetary policies yet with weak growth, structurally constrained

More information

Global high yield: We believe it s still offering value December 2013

Global high yield: We believe it s still offering value December 2013 Global high yield: We believe it s still offering value December 2013 02 of 08 Global high yield: we believe it s still offering value Patrick Maldari, CFA Senior Portfolio Manager North American Fixed

More information

Effect of Rising Interest Rates on Fixed Income. Dominick DeAlto, Global Head, Multi-Sector Fixed Income

Effect of Rising Interest Rates on Fixed Income. Dominick DeAlto, Global Head, Multi-Sector Fixed Income Effect of Rising Interest Rates on Fixed Income Dominick DeAlto, Global Head, Multi-Sector Fixed Income Effect of Rising Interest Rates on Fixed Income I May 2015 I 2 Why Do Investors Allocate to Fixed

More information

DIVERSIFIED GROWTH FUNDS: DO THEY MEET EXPECTATIONS?

DIVERSIFIED GROWTH FUNDS: DO THEY MEET EXPECTATIONS? March 2015 DIVERSIFIED GROWTH FUNDS: DO THEY MEET EXPECTATIONS? In this paper, we ask two questions: Do DGFs meet their objectives? Is their performance good enough? What is a Diversified Growth Fund?

More information

CIO Flash Chinese equities: what happens next? July 8, 2015

CIO Flash Chinese equities: what happens next? July 8, 2015 CIO Flash Chinese equities: what happens next? July 8, 2015 +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH Market falls force

More information

Multi Asset Credit. Reviewing your credit exposure is it time to consider a multi-asset approach?

Multi Asset Credit. Reviewing your credit exposure is it time to consider a multi-asset approach? It seems that whoever you talk to in the pensions industry about their current hot topic, the answer is Multi-Asset Credit (MAC). But what does this term really mean? The answer, it appears, depends who

More information

An Introduction to the Asset Class. Convertible Bonds

An Introduction to the Asset Class. Convertible Bonds An Introduction to the Asset Class Convertible DESCRIPTION Convertible (CBs) are fixed income instruments that can be converted into a fixed number of shares of the issuer at the option of the investor.

More information

Eddie Yue: Renminbi a new era and the role of Hong Kong

Eddie Yue: Renminbi a new era and the role of Hong Kong Eddie Yue: Renminbi a new era and the role of Hong Kong Keynote address by Mr Eddie Yue, Deputy Chief Executive of the Hong Kong Monetary Authority, at the Global Offshore RMB Funding Forum 2012, Hong

More information

ASSETS UNDER MANAGEMENT (US$BN) 44.8. US$94bn* Equity Bond Others

ASSETS UNDER MANAGEMENT (US$BN) 44.8. US$94bn* Equity Bond Others FIXED INCOME CAPABILITIES OVERVIEW OCTOBER 2013 All data as at 30 September 2013 unless otherwise stated ABOUT EASTSPRING INVESTMENTS Eastspring Investments, part of Prudential plc^, is an Asian investment

More information

The Quarterly UK & Eurozone Corporate Cash Report

The Quarterly UK & Eurozone Corporate Cash Report The Quarterly UK & Eurozone Corporate Cash Report October 2011 Volume 2, Issue 1 Corporate Cash Remains Near Record Highs UK and Eurozone corporate cash and short-term investments remain near all- time

More information

9 Questions Every ETF Investor Should Ask Before Investing

9 Questions Every ETF Investor Should Ask Before Investing 9 Questions Every ETF Investor Should Ask Before Investing 1. What is an ETF? 2. What kinds of ETFs are available? 3. How do ETFs differ from other investment products like mutual funds, closed-end funds,

More information

New Issuer: China Merchants Land Limited

New Issuer: China Merchants Land Limited New Issuer: China Merchants Land Limited China Merchants Land has picked Bank of American Merrill Lynch, DBS, Industrial and Commercial Bank of China as joint global co-ordinators, joint lead managers

More information

Bank of America Merrill Lynch Banking and Insurance CEO Conference. London, 29 September 2009

Bank of America Merrill Lynch Banking and Insurance CEO Conference. London, 29 September 2009 Bank of America Merrill Lynch Banking and Insurance CEO Conference London, 29 September 2009 Good morning. I d like to thank Bank of America Merrill Lynch for letting us speak this morning. Before I talk

More information

Opportunities in Emerging Markets Corporate Debt

Opportunities in Emerging Markets Corporate Debt INVESTMENT MANAGEMENT JUNE 2015 Investment View Opportunities in Emerging Markets Corporate Debt Warren Mar, Portfolio Manager for the Emerging Markets Corporate Debt Strategy, discusses the characteristics

More information

Wealth Management Education Series. Explore the Field of Investment Funds

Wealth Management Education Series. Explore the Field of Investment Funds Wealth Management Education Series Explore the Field of Investment Funds Wealth Management Education Series Explore the Field of Investment Funds Managing your wealth well is like tending a beautiful formal

More information

Financing government s borrowing requirement

Financing government s borrowing requirement 7 Financing government s borrowing requirement In brief Government s net borrowing requirement is expected to be R173.1 billion in 2015/16, decreasing to R155.5 billion in 2017/18. South Africa s deep

More information

2006 Municipal Outlook

2006 Municipal Outlook 2006 Municipal Outlook Economics and Demographics and Municipal Yields May 11, 2006 This report has been prepared by UBS Financial Services Inc. Contents Economics: Transition to Slower Growth...3 Monetary

More information

Risks and Rewards in High Yield Bonds

Risks and Rewards in High Yield Bonds Risks and Rewards in High Yield Bonds Peter R. Duffy, CFA, Partner, Senior Portfolio Manager Navy Yard Corporate Center, Three Crescent Drive, Suite 400, Philadelphia, PA 19112 www.penncapital.com 1 What

More information

Are Unconstrained Bond Funds a Substitute for Core Bonds?

Are Unconstrained Bond Funds a Substitute for Core Bonds? TOPICS OF INTEREST Are Unconstrained Bond Funds a Substitute for Core Bonds? By Peter Wilamoski, Ph.D. Director of Economic Research Philip Schmitt, CIMA Senior Research Associate AUGUST 2014 The problem

More information

Get a HeadStart on creating your income portfolio

Get a HeadStart on creating your income portfolio Get a HeadStart on creating your income portfolio The challenge of creating an income portfolio With interest rates still at record lows, many income investors are finding that bond funds alone don t offer

More information

Opportunities in credit higher quality high-yield bonds

Opportunities in credit higher quality high-yield bonds Highlights > > Default rates below the long-term average > > Valuations wide of historical average in BB and B rated credit > > Despite sluggish economy, high yield can still perform well > > High yield

More information

The Mexican Economy: Facts and Opportunities

The Mexican Economy: Facts and Opportunities Manuel Sánchez Santander Global Fixed Income Summit London, England, September 20, 2012 Contents 1 Structural features 2 Recent developments and outlook 3 Inflation and monetary policy 4 Economic challenges

More information

Finding the fix for fixed income. John Stopford Co-Head of Multi-Asset, Portfolio Manager

Finding the fix for fixed income. John Stopford Co-Head of Multi-Asset, Portfolio Manager Finding the fix for fixed income John Stopford Co-Head of Multi-Asset, Portfolio Manager The need for income is increasing It s not just a developed market issue Projected demographic changes across male*

More information

Unconstrained Fixed Income

Unconstrained Fixed Income Unconstrained Fixed Income A Dynamic and Flexible Approach to Fixed Income Investing 26th ANNUAL TEXPERS CONFERENCE Global Fixed Income & Liquidity Management March 2015 This material is provided for educational

More information

Explore the Field of Mutual Funds

Explore the Field of Mutual Funds Wealth Management Education Series How can we help you further? Do you have a question on what you have just read? Would you like to have a further discussion on this subject? Contact your Relationship

More information

CIO Flash Chinese equities: what happens next? July 8, 2015

CIO Flash Chinese equities: what happens next? July 8, 2015 CIO Flash Chinese equities: what happens next? July 8, 2015 +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH Market falls force

More information