Author profile

Mario Eisenegger

Years in the bond markets: 4

Specialist subjects: Economics and corporate bonds

Likes: Handball, Oasis, FC Basel

Heroes: Roger Federer, Quentin Tarantino, Spider-Man

BVTV: Demystifying US high yield – what’s driving YTD performance?

While 2018 has been a mixed year for bond investors so far, with many indices posting negative returns, the US high yield market has – perhaps surprisingly – managed to navigate its way through the turbulence. The sector’s intrinsically shorter duration than its investment grade counterpart may explain part of the divergence, but this is only part of the story.

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BVTV: High drama for Italian high yield?

While political instability is nothing new for Italy, last week’s developments have triggered major market moves. The 10-year Italian government spread to Bunds jumped to as high as 288bps last week, which is an impressive move if you consider that investors were only asking for a risk premium of 122bps at the beginning of the month. Despite a rebound in markets towards the end of the week, the…

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The impact of the technology tantrum on US corporate bond valuations

It is fair to say that markets have become more lively of late. One sector in particular has been the epicentre of revived market volatility – Technology.

In the US high yield market, the US tech sector has weakened relative to the broader US high yield market. Given higher leveraged balance sheets, high yield bonds tend to be more sensitive to sector specific headwinds.

The chart below shows t…

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BVTV: Geopolitical tensions are back in the headlines – what does this mean for bond investors?

On this week’s BVTV I am joined in the studio by fund manager Dr Wolfgang Bauer and we will be focusing on the recent escalation in geopolitical tensions after the US imposed further tough sanctions against Russia. What does all this mean for bond investors and should we be now thinking about de-risking our portfolios? As ever, the picture is more nuanced than it would first appear. While Russi…

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BVTV: What’s in store for retail?

Toys “R” Us announced last week that it has so far failed to find a buyer or reach a debt restructuring deal, raising the prospect of widespread store closures and job losses. While a rescue package could yet emerge, the future is looking far from rosy for the toy store. M&G fund manager and deputy head of retail fixed interest Stefan Isaacs joined me this morning to discuss prospects for the f…

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BVTV: 2018 – the year of the bond bear market?

After such a good run for credit spreads in 2017, and a more challenging start to the New Year for government bonds in particular, are we right to be more cautious about prospects for markets in 2018? Fund manager Wolfgang Bauer joins me to discuss what’s behind the recent sell-off in bunds and Treasuries, and what we can read into primary market activity so far in January. 

Plus, will the ECB…

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Low yield, low quality, weaker covenants

When investing in companies of a lower credit quality, loss given default risk is the key threat that investors have to assess. Consequently, covenant protection is a crucial consideration before lending capital to a company. We wrote about covenant protection back in 2014 and it’s fair to say that covenant quality in the high yield market hasn’t improved much since then; actually quite the opp…

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BVTV: the REIT stuff – a bond investor’s guide to Real Estate Investment Trusts

Today I am joined in the studio by M&G credit analyst Othman El Iraki and we will be taking a closer look at an area of the fixed income market that has been generating a lot of interest in recent months – Real Estate Investment Trusts (REITs). Othman will talk through some of the characteristics of this asset class and explain what’s been driving the recent surge in new bond issuance, especial…

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M&G Panoramic Outlook: “Responsible Junk” – The challenge of integrating ESG factors into a global high yield Bond portfolio.

Growing awareness of a range of environmental, social and governance (ESG) issues has seen an ever larger number of investors move their focus away from purely financial goals towards an approach that also considers the ESG impact of their investments. Consequently,  a pressing question that faces the asset management industry is how to integrate ESG factors into different asset classes and str…

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BVTV: Inflation surprises and central bank dilemmas

Ben Lord, corporate bond fund manager and inflation specialist, joined me in the studio this morning, after a week in which we saw both the UK and US CPI prints surprise to the upside. With some central banks ramping up their hawkish rhetoric in recent weeks, what likelihood of rate hikes are markets now pricing in, and what impact is this having on bond markets? Watch BVTV for Ben’s latest thi…

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