Sharing our convictions

While European ABS was not immune to negative returns amid the considerable fixed income headwinds of 2022, it gave investors largely what they look to this allocation for – lower volatility and better performance than mainstream bonds. In our view, the forward-looking opportunity looks equally compelling.

With projections for European growth and inflation being hastily revised in early 2023, the region’s bonds are still paying investors a premium that may not be around for long, says Dillon Lancaster.

As new regimes emerge, so do new words to explain them. Understanding the world, one geopolitical term at a time.

Traditional investment strategies unraveled in 2022 amid geopolitical and energy crises. As 2023 gets under way, these negative trends have started reversing, giving our Corporate Credit team comfort about the prospects for the European investment grade credit market in the months ahead.

Recent employment data suggests the US economy may escape with a soft landing, a welcome boost to market sentiment in the early days of 2023, says Eoin Walsh.

Should we blindly follow a machine? Or is human judgment needed to make weighed decisions? We believe that man and machine must act as a team to achieve the best results. That's why we developed the Wave, which is based on a big data approach and serves as a compass in our investment process.

The yield curve and our models point to a high probability of recession. But how severe will the U.S. recession be? To answer this question, we exploit historical data to examine the impact of the tightening cycle on GDP growth. The results show that investors should exercise caution in 2023.

Welcome to 2023! At the start of the new year, bonfire rituals across the globe celebrate the time for renewal. Our Global Corporate Bond team have evaluated perspectives for the market by asking themselves the ten most burning questions for the year ahead – and finding the answers.

After a decade of underperformance, we believe emerging market equities are set for a brighter next chapter and any further short-term pain will be outweighed by the opportunity for longer-term gain. Here are three reasons why:

Is it now the time to invest in emerging markets fixed income? As 2023 progresses, there are strong arguments for this asset class. We also believe risk concerns remain manageable. Waiting on the sidelines was perhaps the smartest thing to do in 2022, but may not be the best strategy next year.

The Politburo, the top decision-making body of the Chinese Communist Party, announced last week a document focusing on the country’s economic growth in 2023. Meanwhile, the Chinese government also started to exit its zero-Covid-policy, much sooner than anticipated. These intentions signal an earlier-than-expected recovery of the Chinese economy.

As one of the newest partners of the Financial Times’ Moral Money Forum, we take the opportunity to introduce who we are and what Vontobel does in its latest report.

In TwentyFour Asset Management’s annual fixed income outlook, Eoin Walsh says that with rates now offering both yield and downside mitigation, and credit yields at near-decade highs, fixed income investors could enjoy strong returns in 2023.

Structural themes underlie opportunities in the year ahead. Our Quality Growth portfolio managers expect stock performance will be more closely tied to earnings growth, the US consumer will remain healthy, select emerging markets are poised for continued growth, and certain Chinese stocks will benefit from a reopening.

Fixed income managers always want to have the flexibility to look for the best value across their investment universe, and in our view they therefore need the capacity to buy bonds in different currencies.

Following Chairman Powell’s speech last night, George Curtis looks at what the latest labour market data means for the Fed’s war on inflation.

Bids Wanted in Competition (or BWIC) lists are a unique characteristic of the ABS and CLO markets, where they are widely used in secondary trading when investors are looking to sell bonds.

Following a difficult and volatile 2022, there are sound reasons to believe that EM equities could deliver a strong rebound in 2023. Along with compelling relative valuations of EM equities, we identified three key cycles that have the potential to provide a positive boost to EM equities next year.

Inflation is widely understood to be bad for bonds. Fundamentally, this is because inflation erodes the value of the coupon and principal payments that fixed rate bondholders receive in the future.

The goal of income investing is to ensure that your portfolio generates a steady source of revenue regardless of market conditions.

Biodiversity loss often takes a backseat to climate change in global headlines but ignoring the preservation of natural ecosystems poses a threat to water, land, marine life, health, and can increase poverty. There is an urgent need for change. The upcoming COP 15 will address biodiversity solutions that will benefit companies, investors, and society.

With investors caught between inflation and recession, TwentyFour Asset Management’s Chris Bowie argues current valuations in short term, investment grade bonds can offer portfolios both downside protection and attractive yields.

China’s authorities have recently revealed coordinated measures to alleviate the pressure on its property sector. The government tried to help the sector in the past year but failed; however, this time could be more determined and effective.

In late 2022, financial markets are in the middle of a structural break. This may precipitate a regime change that will alter essential market risk-return features: low inflation, low volatility, and low correlations. This paper tells you why and how investment solutions must adapt to new conditions to continue delivering attractive investment outcomes.