Perspectives Blog

Investing selectively in Asia

Soo Nam Ng, Head of Asian Equities | July 14, 2014

…their investment merits, the investor needs to value resilient growth over high growth and be willing to harvest dividends over a multi-year horizon. While return expectations from potential share price appreciation may need to be moderated, the investor should consider a more deliberate harvesting of dividends as an equally important and recurring source of return to help anchor performance consistency. Contrarian opportunities While the underpi…

Surveying the landscape for M&A

Robert McConnaughey, Director of Global Research | March 3, 2014

Cash-rich corporations are increasingly considering M&A. The market is rewarding acquirers generously (for now). How can investors position in front of potential M&A without paying an excessive premium that leaves room for disappointment? Cash balances at U.S. non-financial corporations have exploded in the post-crisis era, despite a rising return of cash to shareholders in the form of dividends and share repurchases. One other option…

New taxes require strategies to maximize after-tax return

Abram Claude, Vice President, Columbia Management Learning Center | March 18, 2014

Higher earners with taxable investments are most susceptible to triggering the net investment income tax, a surtax of 3.8% that applies to taxable investments. An asset location strategy involves placing a greater percentage of the most tax-sensitive investments in tax-deferred accounts. Retirement plans offer significant opportunities for participants and business owners to reduce taxable income. In 2013, new taxes associated with the Afforda…

Quality milestone in the European recovery story

March 17, 2014

Business, economic and political news all point to a strengthening recovery in Europe. We foresee a period of low inflation and low interest rates in Europe. We favor domestic European plays over internationally-exposed stocks, with an overweight stance in banking and telecoms. By Paul Doyle, Head of Europe ex. UK equities and Frederic Jeanmaire, Fund Manager, Threadneedle Investments After 18 consecutive negative months, the flow of eurozone…

Q2 fixed income outlook – Hitting for the cycle

Gene Tannuzzo, CFA, Senior Portfolio Manager | March 31, 2014

We have started to reduce exposure to high-quality bonds with limited upside potential and high-yield bonds in which credit risk appears too aggressive. Following weakness last year, emerging market debt has posted gains this year, and we expect further strength ahead as volatility subsides. While we expect a flatter yield curve over the next few months as investors focus on the timing and pace of rate increases, we don’t think they should avoi…

Should your income be fixed?

David King, CFA, Senior Portfolio Manager | December 16, 2013

Investors need to rethink the role of fixed income in building portfolios How to provide an adequate rate of return with an acceptable level of risk Benefits of a non-fixed, income-oriented strategy in today’s environment Peanut butter and jelly. Bacon and eggs. Scotch and soda. In the investment industry, the words “fixed” and “income” seem as inseparable as our favorite food and beverage combinations. Something which has served millions of p…

Rebalancing the U.S. economy

Marie M. Schofield, CFA, Chief Economist and Senior Portfolio Manager | January 13, 2014

Both fiscal and monetary policy will begin to normalize in 2014 The economy’s performance will be an important metric for markets as growth needs to catch up The key to getting growth beyond 2% is for business to borrow to improve/expand productive capital It’s happening again—a fourth quarter bounce in economic activity that extends into the first quarter and supports the view that growth really, finally, has started to accelerate. Such bounc…