Mon, Dec 5, 2016
A A A
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Other Voices: Great rotation? What great rotation?

Friday, May 17, 2013

amb
Alex McKnight
In the article below, Alex McKnight, investment manager at GAM, an independent, active investment management firm, comments on why convertibles are catching investors’ eyes.

We believe the "great rotation" is overhyped, what we are seeing is actually a natural shift into riskier equity linked assets as markets rise and risk aversion begins to wane. This reflects fixed income investors moving into areas that are less exposed to the rise in interest rates and falling bond yields that typically occur when economies are improving and equity markets are rising. Given the strong performance of credit markets last year we are starting to see investors switch out of investment grade and high yield credit into convertible bonds, to take advantage of increasingly bullish markets.

Convertible bonds issuance has been strong this year, with deals announced in European household names including Air France and Melia Hotels. While not all recent convertibles issuance represented good value for money, we believe there is no such thing as 'bad’ new issuance. Deals can be individually poor, yet new issuance is always positive for the market as it provides greater choice and indicates that issuers are keen to release paper, thereby widening the investable universe. Lower quality issues also create attractive hedging opportunities as they can be shorted.

The UBS Global Focus Inv Grade CB Index ha......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

 



  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. M&A - AllianzGI to acquire Sound Harbor Partners, SS&C completes acquisition of Wells Fargo's Global Fund Services business[more]

    AllianzGI to acquire Sound Harbor Partners Allianz Global Investors (AllianzGI), an active investment manager, announced that Sound Harbor Partners, a US private credit manager led by Michael Zupon and Dean Criares, have agreed to join its fast-growing Private Debt Platform. Under the te

  2. Hunt for yield pushes more investors into riskier assets[more]

    From FT.com: Pension funds and insurance companies have increasingly embraced riskier assets in their hunt for higher returns over the past five years. Alternative assets such as property, infrastructure, private equity and hedge funds have been bought up by institutional investors in a world where

  3. People - Nectar Financial hires senior investment team, Texas A&M replaces retiring foundation investment chief, Ex-Cadwalader partner Woolery makes another sudden exit, How to become a Python coder at a top hedge fund, by the co-CTO of Man AHL[more]

    Nectar Financial hires senior investment team Nectar Financial AG, a Swiss financial technology company for wealth and asset management, has announced that it has hired two key senior leaders to spearhead its digital asset management efforts. The company also announced that it has entere

  4. Activist News - Cognizant has introductory discussion with activist investor Elliott; to review letter, Starboard Value makes huge investment in Hewlett Packard, Hedge fund calls for removal of First NBC Bank CEO[more]

    Cognizant has introductory discussion with activist investor Elliott; to review letter From Indiatimes.com: Cognizant said it had an introductory discussion with Elliott Management after receiving the activist hedge fund's letter asking for a board shakeup, a buyback, a dividend and chan

  5. Opalesque Exclusive: Ireland relaxes treatment of direct lending funds[more]

    Bailey McCann, Opalesque New York: The Irish Central Bank has relaxed its treatment of direct lending funds, according to a recently released