Debt and Credit Outlook

Debt and Credit Outlook - Articles & White Papers

White papers and articles relating to the debt and credit outlook; covering sovereign bonds, corporate bonds, municipal fixed income, high yield and index-linked bonds. Amongst the most popular fixed income research in this section are papers on bond market liquidity risk, in particular studies of global financial market liquidity and surveys of long-term US interest rates (why long-term interest rates are so low, etc). White papers on bond market valuation tend to be well received. For example, an analysis of the valuation of UK index-linked gilts (why are linkers persistently overvalued?) has been a popular paper. As expected, reports which examine the interest rate outlook have proved popular, particularly those seeking to explain the thought-processes at the FOMC, ECB, BoE, MPC et al. Amongst the periodic fixed income outlook documents on the site, perhaps the most popular is the Prudential Fixed Income Quarterly Outlook and the Goldman Sachs Global Fixed Income Outlook. Practical papers for fixed income fund managers have also proved popular, for instance on managing credit and interest rate risk in the current environment, or the implications of negative yields for fixed income funds.
  • Invesco US

    Invesco Global Fixed Income Study 2018

    Since the turmoil of the financial crisis, investors are navigating a great calm in fixed income markets, however, there is a sense amongst investors that the prevailing period of calm is coming to an end as central bank intervention is withdrawn and investor behaviours subsequently change. Through conducting 79 face-to-face interviews with leading fixed income specialists across ...

  • Robeco

    Five-Year Expected Returns 2018-2022: Coming of Age (Robeco)

    In this 106-page document, Robeco presents its forecasts for the 5-year expected returns for all major asset classes.

    Robeco strategists aim not to give an accurate, detailed account of what will happen the next five years: they do not profess to know that. They present the broader trends, the averages. This publication includes special topics on secular stagnation; the ...

    • Professional
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  • World’s largest hedge fund chief: The economy looks grim in the long-term (May 2017)

    In this blog post, Ray Dalio of Bridgewater Associates discusses the near- and long-term prospects for the global economy. The near term looks good because the economy is now at or near its best, and there no major economic risks on the horizon for the next year or two. The long-term looks scary because there are significant long-term problems (e.g., high debt and non-debt ...

    • Professional
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  • Eaton Vance Management International

    Emerging Markets Local Income (EMLI) strategy: Casting the widest net in emerging-markets debt (Eaton Vance)

    In 2017, investors rediscovered their enthusiasm for emerging-markets (EM) local currency debt. With a yield in excess of 6% on the JP Morgan Government Bond Index – Emerging Markets (GBI-EM) Global Diversified in 2017 as of 30 September, EM local currency debt has been the highest yielding of the major global fixed-income sectors. Total return in US dollars over the same ...

  • Barings

    EM Local Debt: Focused on Fundamentals (Barings, Feb 2018)

    Barings' combination of quantitative and qualitative analysis and tools provide a comprehensive and rigorous framework for investing in emerging markets local debt. In this Viewpoint, we give readers an inside look into our investment process.

  • Royal London Asset Management

    Securitised Bonds: Finding Security in Bond Markets (RLAM, 2017)

    Secured (or securitised) bonds still carry the stigma of the 2008 financial crisis. But stigma often spells opportunity, and the fixed income specialists at RLAM argue that this asset class offers great value for managers who are prepared to get to grips with the documentation underlying individual securities. Not everyone is prepared to do this research, and as a result secured ...

    • Professional
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  • Schroders

    Long-run asset class performance: 30yr return forecasts (2017-46) Schroders

    Schroders Economics Group produces 30-year return forecasts, on an annual basis, for a range of asset classes. Here they outline the methodology used, which is based on a series of building blocks and estimates of risk premia, and surmise the key conclusions from our analysis. For the first time, this year they are also publishing a wider range of country-specific returns for ...

    • Professional
    • Views: 2859
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  • Credit Suisse

    The Future of Monetary Policy (Credit Suisse, 2017)

    This Credit Suisse paper looks at the transformative changes central banks in advanced economies have undergone since 2008. The report concludes that the key issue for decision-makers globally remains to consider which fundamental direction monetary policy ought to take next, assessing two alternative scenarios that may evolve: a return to a pre-crisis "normal", or fiscal dominance.

    • Professional
    • Views: 1352
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  • Federal Reserve Bank of San Francisco

    Measuring the Natural Rate of Interest (John Williams of FRBSF, Dec 2016)

    U.S. estimates of the natural rate of interest – the real short-term interest rate that would prevail absent transitory disturbances – have declined dramatically since the start of the global financial crisis. The authors of this paper find that large declines in GDP trend growth and natural rates of interest have occurred over the past 25 years in the four economies ...

  • Franklin Templeton Investments

    Opportunities in Emerging-Market Local Currency Bonds (Franklin Templeton, May 2018)

    As the emerging-market debt asset class continues to evolve and expand, investors are increasingly looking for strategies that are dedicated to the segment of the market denominated in local (i.e., domestic) currencies versus hard/external currencies [i.e., the US dollar (USD) or euro]. Rationales range from diversification benefits and inflation hedges to reducing external debt ...

  • BlackRock

    Global Investment Outlook Q2 2018 (BlackRock)

    As the second quarter of 2018 is underway, BlackRock gives updates on three 2018 investment themes against a backdrop of synchronized global growth, an inflation comeback, rising interest rates and more economic uncertainty. Equity market volatility has also been on the rise, where the low-volatility environment felt its first tremors of change in February’s spike.

    In ...

  • What is Mezzanine Financing? (Pricoa Capital, Apr 2018)

    Named for its place in the capital structure, mezzanine financing is a form of junior capital that sits between senior debt financing and equity. It is the last stop along the capital structure where business-owners can raise sizeable amounts of liquidity without selling a large stake in their company.

  • Invesco (Europe)

    Risk & Reward Q1 2018 (Invesco)

    This issue of Risk & Reward examines cryptotokens. Bitcoins and other cryptocurrencies have capti-vated a large segment of the retail investment world in ways not seen since the dotcom bubble. It is undoubtedly a speculative bubble – yet most speculative bubbles have something real and potentially transformative underpinning them. We spoke to Chris Burniske, a partner at ...

  • BNP Paribas Asset Management

    Local currency emerging market debt: deserving of a closer look (BNP Paribas AM, Apr 2018)

    Local currency debt has become one of the largest fixed-income universes over the past eight years, yet remains under-appreciated. We can see a number of triggers for a pick-up in demand. We believe growth is the main forward indicator for currencies. The asset class offers multiple opportunities, collating a heterogeneous group of bond issuers including countries in different ...

  • PGIM

    Long Term Interest Rates: Perfect Storm, Buying Opportunity, or Both? (PGIM, Mar 2018)

    • 12 Apr 2018
    • Company: PGIM

    Robert Tipp, CFA, Managing Director, Chief Investment Strategist, and Head of Global Bonds, addresses questions pertaining to the recent increase in developed market interest rates, including the effects from increased Treasury supply, a rising Federal deficit, normalizing developed market monetary policies, and a weaker U.S. dollar. 

  • NN Investment Partners

    Reaping the Returns: 25 years of EMD investing (NNIP, 2018)

    NN Investment Partners’ Emerging Market Debt (EMD) Hard Currency (HC) strategy celebrates its 25-year anniversary this year. Over that time, the EMD opportunity set has evolved considerably. EMs have undergone dramatic economic improvement and today they present a compelling source of returns for all kinds of investors.