After over a decade of being a friend, duration risk became the bond market’s foe at the end of 2020. For the next two years, duration was a bogeyman for bond investors, causing sharply negative returns as government bond yields skyrocketed in response to higher inflation and aggressive rate hikes from central banks.
In the latest Strategic Thinking video, Colin Finlayson, co-manager of the Strategic Bond strategies, discusses whether the Fed hiking cycle could be over, the US debt ceiling, the ongoing US regional bank turmoil and the next moves for the Bank of Japan. Against this backdrop he also reviews the performance of the Aegon Strategic Bond strategies.
In the latest Strategic Thinking video, Colin Finlayson, co-manager of the Strategic Global Bond strategies, shares his thoughts on the market backdrop for fixed income as the stresses within the banking system spread from the US to Europe, how the portfolios were affected by the headwinds from the banking sector and gives his outlook for the next few months.
Climate change and the transition to net zero is an increasingly important theme for investors. Significant action is required to reduce our greenhouse gas (GHG) emissions throughout the world. We expect the scrutiny by regulators and underlying pension scheme members of climate-related exposures to only increase. This raises the question how climate change can be incorporated within portfolios, including fixed income portfolios.
In the latest Strategic Thinking video, Colin Finlayson, co-manager of the Strategic Bond strategy, shares his thoughts on the market backdrop for fixed income, if the market is over-or-underpricing rate hike expectations, where he thinks credit markets will go next and gives his outlook for the next few months.
The opening months of 2023 have been something of a curate’s egg for the global high yield market. January witnessed a truly monumental rally that surprised many with its ferocity, driven in no small part by the supportive technical environment. However, February’s performance has been more circumspect as, among other things, rates markets have sold off and put pressure on total returns.
The positive correlation of bond and equity returns stood out in 2022. Vincent McEntegart, Co-Manager of Aegon Diversified Monthly Income Fund, and Nick Edwardson, Senior Investment Specialist of Multi Asset & Solutions, discuss how the relationship between equities and bonds might change as the cycle progresses, how portfolios can adapt to drive returns and their reaction to current concerns around financial stocks.
The annual J.P. Morgan Healthcare Conference has become one of the preeminent healthcare investment gatherings in the industry. It brings together members of the investment community with industry leaders from hundreds of companies, ranging from emerging fast-growth companies and innovative technology creators, to large and established for-profit and not-for-profit entities.
Although markets have rallied, the outlook for 2023 remains uncertain. Vincent McEntegart, Co-Manager of Aegon Diversified Monthly Income Fund, and Nick Edwardson, Senior Investment Specialist of Multi Asset & Solutions, discuss the attractiveness of bonds verses equities, having the right balance of asset classes and picking opportunities that will be the most resilient in this environment.
They think it’s all over
Challenging economic conditions are setting the stage for an interesting year ahead. As the economy slows and the cycle ages, companies will likely face financial headwinds. Although firms are entering the year with solid balance sheets, can high yield issuers weather a downturn?
As we head towards the completion of Rishi Sunak’s first 100 days as UK Prime Minister, it is worth reflecting on how sterling credit markets have fared since the end of the disastrous and short-lived Truss Premiership.
Although the economy will likely face a recession, there are signs that 2023 will be a better year with inflation easing and valuations facing less of a headwind. Nick Edwardson, Senior Investment Specialist in our Multi-asset and solutions team, discusses how we expect the correlation between bonds and equities to flip, the evolving currency markets environment and the impact of the global transition to net zero. The ability to make timely asset allocation changes will be key to navigating this shifting investment landscape.
Each month the team behind our sustainable equity funds answer five topical questions in five minutes – or sometimes a little over! They tackle questions on sustainability issues, introduce new stocks and discuss the impact of market conditions.
In the latest edition of Strategic Thinking, Colin Finlayson, co-manager of the Strategic Bond strategy, shares his thoughts on the key macro-economic factors that are worth watching for to determine the direction of fixed income markets in 2023. Colin also explains the reasons why we believe 2023 offers a much more positive outlook for bond markets and how we plan to take advantage of this within our portfolio positioning.
There have been some counterintuitive yet confident statements coming from office REITs over the last few months. A large UK REIT/developer is feeling confident to deliver rather bulky offices in the City of London office market by 2025. Another REIT/developer in Australia expects the ratio development and investment income in office could actually shift toward the former. Counterintuitive, as office space use is expected to decline by roughly 10% as a result of work-from-home trends, while the expected economic deceleration could also weigh on demand.
This note provides an overview of the main developments within our diversified income strategy in 2022 and how we are positioned for 2023 and beyond.
This is the final instalment of our Future of series. We hope you have enjoyed our deliberations over how some sectors might evolve to face future challenges.
While Mick Jagger wanted to paint red doors black, it is an American tradition from the 1950s that is the inspiration for retailers across UK & Europe choosing black over the past decade. Black Friday, which is the day after Thanksgiving in the US, marks a consumer purchasing frenzy with people trying to snap up bargains ahead of Christmas. What is the impact of this mass consumerism?
I was recently reading the ESG section of one of our Japanese holdings, Kubota, when I came across some interesting statistics highlighting major issues in the food chain.