Fixed Income and Treasury - Articles & White Papers

This paper explores the practical, theoretical and empirical case for an indexed approach in fixed income, outlining why passive investing came later and examining whether its growth might continue to echo, or even catch up to, that of equity markets.

Our 2024 expectations for annualised returns over the next 20 years are a mixed bag. Strong gains across markets over the past year have tempered our expected returns for equities relative to our 2023 outlook. On the other hand, higher starting yields translate into improved expectations versus last year across many fixed…

Do regimes exist in reality or just in hindsight? Can one reliably profit from correctly identifying them and if so, how?

We have pared back our expectations for a US recession until later in the year. However, the Active Fixed Income team continues to question whether inflation really is yesterday’s problem.

Private credit – specifically middle market, sponsor-backed direct lending – looks uniquely positioned to weather the future storm thanks to a number of supportive structural factors.

Private credit as an asset class is in demand from a range of investors. The asset class has become a direct substitute for traditional fixed income assets for many investors, which are continuing to increase allocations. A recent investor survey suggested that 51 per cent of existing private credit investors expect to…

While a U.S. recession doesn’t appear to be in sight, global economic conditions remain uneven.

For investors that want to support real-world decarbonisation through their portfolios, carbon footprint alone will not suffice. This paper explores why and begins to offer outlines of an alternative, which we will build upon in future publications.

Today, the U.S. ABF market stands at ~$7tn, claiming a material presence of the $40tn+ U.S. financing market. We estimate private ABF is on track for 20%+ annual growth over the next several years. Looking toward to the future of private credit portfolios, we believe private ABF provides a compelling value proposition that…

We study how investor demand and composition affect government bond yields. We estimate how investors adjust their holdings when debt levels increase, and how sensitive their demand is to a change in prices. We also show that quantitative tightening by central banks can have a significant impact on yields when investors are…

The Franklin Templeton Fixed Income team believes more sovereigns are turning to the IMF for financing support as capital markets for low-income countries remain shut. In this paper, they consider how the IMF Debt Sustainability Framework could play a crucial role.

We look at how to build a global Sustainable Development Goals alignment model and how to integrate this in sovereign risk analysis.

We explore the historical record of the Fed Model, measured as stock-bond real yield difference, to explain future stock-bond relative total returns.

The United States is approaching an unprecedented level of debt, potentially risking economic stability and demanding dramatic fiscal measures.

Actively managed fixed income portfolios have several distinct advantages over passive approaches.

The green, social and sustainable (GSS) bond market has increased rapidly over the last few years amid growing concerns about climate change and wider environmental and social issues. Green bond issuance continues to attract attention as a potential vehicle to help finance the transition to a low carbon economy.

Green bond issuance has increased dramatically in the last five years. But how do corporate green bonds compare quantitatively to their non-green counterparts?

It’s not complicated. Allocators are formulating return and risk assumptions for private debt that compare favorably to other asset classes, in turn recommending new or higher private debt allocations using traditional asset allocation models.