Managers’ View – Marzo 2019
Adjuntamos algunos informes de análisis y opiniones de nuestros gestores que consideramos de gran interés.
Please find below interesting market views from our Managers. We hope you find them interesting.
Weekly Briefing March 4th
As markets continue to rally, the divergence in performance between small and large issues within the ICE BofAML US High Yield Index (H0A0) has accelerated. Due, perhaps, to retail inflows into ETFs (which have historically favored the largest / most liquid high yield bonds) and lingering economic uncertainty (which may compel investors to opt for liquidity in case sentiment were to change), the ratio of spreads between relatively small ($350mm in size and lower) and large ($1bn in size and higher) issues has reached top-decile levels (using trailing 20-year data)
Weekly Briefing March 18th
As a somewhat uneventful Q4’18 earnings season nears completion, investor attention will inevitably shift toward probable Q1’19 profitability headwinds. As such, the focus of this Weekly Briefing is to translate slowing (and potentially negative) S&P 500 earnings growth expectations into a readthrough for US high yield issuers, identifying parts of the market that may be at greater risk for fundamental degradation and spread volatility in the near term.
Weekly Briefing March 25th
A rapid recovery in spreads following acute dislocation in Q4’18 has many investors concerned about valuations in the US high yield market. In this Weekly Briefing, we segment the market into various rating, duration, issue size, subordination, sector, industry and earnings volatility buckets, all in an effort to identify YTD laggards overlooked by investors.
Weekly Briefing April 1st
US Treasuries rallied following what was considered dovish commentary from the March 20 Fed meeting, with yields on the 10-year falling to 2019 lows. Despite the potential for economic headwinds arising from trade tensions, a slowing European economy and dwindling tax cut stimulus, we believe US high yield markets can benefit from moderate GDP growth in the context of lower year-end rate expectations. In this Weekly Briefing, we examine the impact lower Treasury yields may have on high yield index returns in 2019.
Rubrics – Fixed Income Quarterly April 2019
To continuation of the drop in global bond yields has been a feature of 2019. Much of this has been driven by the mnarked turnaround in the monetary policy stance of the US Federal Reserve. Whilst changes in certain economic and financial indicators (PMI, Retail sales, US yield curve) support this shift in outlook, other (inflation expectations, employment, wages) metrics have remained resilient. Perhaps most notable of all is the continued strong performance of risk assets in the face of increasing global uncertainty.
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