Creating a Eurozone-wide safe asset and thus diversifying sovereign risk within the currency union without the need for sovereign debt mutualisation – sounds like having your cake and eating it, doesn’t it? Well, according to the European Systemic Risk Board (ESRB), sovereign bond-backed securities (SBBS) might do the trick. SBBS are merely an idea, discussed in ESRB working papers, feasibility…Read the article
President Trump has sent shockwaves through the global business community with his decision to impose tariffs on steel and aluminium imports to the US. Will this protectionist move prove to be the catalyst for an eventual downturn in global economic growth, and what are the implications for equity and bond markets? Randeep Somel, deputy fund manager in M&G’s equities team, joined me this mornin…Watch the video
In this week’s episode, fund manager Charles de Quinsonas joined me to discuss what the recent bout of market volatility meant for the emerging markets. Were all parts of the EM bond universe equally affected, and where do we see most value today?Watch the video
This morning on BVTV I look at a couple of hot topics we’ve been discussing in recent meetings. Firstly, is it the market rather than the Fed that has been behind the curve? Secondly, in the UK, has the Bank of England’s thinking on Brexit changed in recent weeks? And in both cases, what does this mean for rate hike expectations?Watch the video
With the European economy growing at its fastest pace for a decade – and with Italy itself seeing an impressive return to growth – the uncertainty of an Italian election is something investors will be keeping a close eye on. The country goes to the polls on 4 March, although the outcome is unpredictable with many observers expecting a hung parliament and no outright winner.
To discuss the poten…Watch the video
In its 2016 Annual Report entitled ‘making tomorrow a better place’, Carillion claimed they had ‘a good platform from which to develop the business in 2017’. Less than ten months after publication, Carillion went into compulsory liquidation, bypassing administration and the chance to continue trading. Assets will be realised and distributed to creditors, leaving little or no value remaining. Bu…Read the article
The United States government routinely finances itself through short-term debt, which is normally less expensive than long-term debt, due to the upward sloping nature of the U.S. yield curve. This cost saving does increase the risk of default. Rollover risk arises any time short-term debt is used to finance long-term spending. It is what keeps debt management officials up at night.
The U.S. gov…Read the article
After a rollercoaster week for equity markets, which saw the VIX volatility index spike to one of its highest ever levels, I’m joined this morning by Craig Moran, fund manager in M&G’s multi asset team. Tune in as we discuss what drove the correction, whether it’s likely to prove a short term risk-off event or a longer-term market reversal, and how much further equities can potentially rally, g…Watch the video
Some of the worst performing bonds in the European high yield index in 2017 all had weak Environmental, Social, and Governance (ESG) scores according to MSCI. Is this is a coincidence or is it indicative of a relationship between poor ESG metrics and bond performance?
To find out the answer, we analysed the 2017 total returns of the 365 bonds in the European high yield market that were ESG rat…Read the article
Subordinated debt enjoyed an excellent year in 2017, AT1 (Additional Tier 1) bonds in particular. But what are the unique features of this sub-asset class and do AT1 bonds still offer value? M&G credit analyst Mark Robinson, who focuses on the banking sector, joined me this morning to explain the challenges that today’s tight spread levels potentially hold for investors.Watch the video