Perspectives Blog

M&A in healthcare – Out with the old, in with the new?

Harlan Sonderling, CFA, Senior Healthcare Analyst | March 31, 2014

…ccrued more to the selling shareholders than to the acquirer’s. More often than not, Company A’s stock price would decline on the day of the announcement, and Company B’s would rise as Company A diverted from dividend growth, debt reduction and using its cash to invest in organic growth. Investors assumed, until proven otherwise, that acquisitions were value destructive, at best a means of manufacturing earnings to manage through a period of poor…

In the land of 7 footers, 6’8″ plays guard

Fred Copper, Senior Portfolio Manager | May 5, 2014

…r each year for the next five years is a powerful incentive for investors to hunt for returns that will at least not be certain to lose money in real terms, even if that means dabbling in asset classes such as emerging market debt that until recently were considered too racy for a standard portfolio, or indeed buying stocks after six years of sharp gains. This risk taking behavior is an intentional and essential part of central bank policy. Post…

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…

The beginnings of a new moderation in Asia

Soo Nam Ng, Head of Asian Equities | June 2, 2014

…China under the Xi Jinping leadership. Post the GFC, the Hu-Wen leadership in China rolled out aggressive and hastily implemented fiscal measures in a bid to prevent a sharp slowdown. Low return projects and local government debt issues followed, including the LGFV(2) issues that have been touted as a potential non-performing loan problem for the banks. Policymakers did manage to keep growth above 9% until 2011 (Exhibit 1), but sustainability wa…

Comments on the effect on global markets from the Ukraine crisis

Mark Burgess, Chief Investment Officer, Threadneedle Investments | March 12, 2014

To date, the fallout from the Ukrainian crisis has been largely confined to the emerging market debt, emerging market equity and commodity markets. At current levels, emerging market local currency debt appears to offer value, although we expect both the hard and local currency markets to remain volatile in the short term. Emerging equities reflect concerns not only around Russia and Ukraine but also the weaker growth outlook in Brazil and China…

The importance of taking a long-term perspective

Jeffrey Knight, CFA, Global Head of Investment Solutions and Asset Allocation | February 3, 2014

…U.S. Aggregate Bond Index is a market value-weighted index that tracks the daily price, coupon, pay-downs, and total return performance of fixed-rate, publicly placed, dollar-denominated, and non-convertible investment grade debt issues with at least $250 million par amount outstanding and with at least one year to final maturity. The Barclays U.S. Corporate Investment Grade Index is an unmanaged index consisting of publicly issued U.S. Corporat…

Gut check: The outlook on fixed income

Colin J. Lundgren, CFA, Head of U.S. Fixed Income | February 24, 2014

…or performance can be explained as payback (reversal of strong inflows when the sector was in favor), concerns about tapering, China slowing and deteriorating growth prospects more broadly in EM countries. Countries in the EM debt market that suffered the most last year were those that ran large current account deficits and faced potential funding challenges when the Fed tapered (i.e., the so-called “Fragile Five” countries of India, Indonesia, T…