TURNKEY SOLUTIONS FOR WEALTH MANAGER AND FUND MANAGER
Income returns have decreased by almost 70% for European investment grade bonds and by around 50% for European high yield bonds over 2007 to 2020. European loans, however, have been much less affected as the asset class is not part of the European Central Bank’s quantitative easing programmes. European loans are at an advantage as […]
Income Returns have descreased Read More »
Long-term interest rates have spiked from historical low levels in anticipation of a strong recovery. With the US ISM Services PMI surging to an all-time high of 63.7 points (previous month 55.3), US long-term interest rates may continue to trend higher. As a consequence of the recent rise in interest rates, US investment grade bonds
Long-term interest rates have spiked Read More »
Chinese producer price inflation (PPI) accelerated from 0.3% year-over-year (yoy) in January 2021 to 1.7% yoy in February 2021. For March, an advance PPI inflation tracker points to an increase of 5% yoy. Global price pressures are building due to the yoy base effect, pent-up demand and on the back of supply chain disruptions. This
40ft container Shanghai to New York Read More »
US treasury yields have risen from 0.8% end of 2020 to currently 1.7% and bond investors have suffered painful losses on their long-duration bonds (up to -5% ytd). Senior secured loans are valued with a fixed credit risk premium combined with the money market rate. They are so-called “floaters” and tend to gain in value
US treasury yields have risen Read More »
Global reflation continues and inflationary pressures are building. From semiconductor chips to copper, demand is on the rise while capacity remains constrained. While Western governments have largely maintained consumer income, investments into production capacity is lagging to absorb the recovered spending capacity. Markets have recognized this to some extent and inflation rates are on the
Since December 2020, 10yr US Treasury yields rose 60 bps, while expected inflation remained flat at ~2.2%. Inflation (i.e. measured by “PCE” = Price Consumer Expenditures) will likely pick up significantly from current levels of ~1.4% over the next quarter because of the year-over-year base effect and cyclical market forces. The US Fed announced that
10yr US Treasury yields rose 60 bps Read More »
US consumer spending is the engine of economic growth and is close to 70% of GDP. According to a recent survey by the Harris Poll, 71% of Americans say they miss socializing in restaurants and bars and 61% say they miss shopping in stores. Growing percentages of people say they’re planning on splurging on vacations,
US consumer spending Read More »
The US bond market has seen the 2yr/10yr US treasury yield curve steepening. The steepening is justified by the cyclical rebound, pent-up demand and higher inflation. Should inflation surprise on the upside and long-term yields continue to rise, the US Fed will have to decide on how to control the yield curve if they don’t
SPACs are special purpose acquisition companies designed to enable their managers to have funds available to make acquisitions quickly and on an opportunistic basis. Thanks to their asymmetric return profile, SPACs popularity has shot up and volumes exceeded USD 80bn in 2020. Within the first six weeks of 2021, SPAC volumes have already reached USD
SPACs acquisition companies Read More »
Compared to the US, trade and manufacturing make up a larger share in the European economy and Europe’s cyclical/defensive stock ratio is a good indicator for the global industrial cycle and the direction of US long-term bond yields. Over the past few months, European cyclicals have strongly outperformed European defensives indicating continuing positive momentum in
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