Fixed Income – Page 10
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NewsGermany’s KENFO plans slight increase in illiquid assets
The fund took tactical measures to cushion losses in 2022 that stood at the end of the year at -12.2%
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NewsNordic roundup: Industriens posts 3.3% in H1, Sampension sees weaker H2
Sampension CIO says second half of 2023 could well be weaker than the first, as market positivity overblown
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NewsSovereign investors reshape portfolios after year of negative returns
Sovereign investors are now more resolute than ever in their ambitions to fund the energy transition
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NewsBayer Pensionskasse prioritises fixed income high credit rating allocation
Following an ALM study last autumn, the scheme has adjusted its strategic asset allocation
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NewsGerman doctors’ pension scheme builds up directly-held bond portfolio
The pension fund recorded positive returns of 3.3% last year on assets invested, despite losses in bond and equity markets
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InterviewsOn the record: Doubling down on debt
Pension funds are focusing on both listed fixed income and private credit
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Asset Class ReportsPortfolio strategy – Fixed income & credit
Factors including rising inflation and interest rates, the war in Ukraine, and the uncertainty surrounding the global economy might have significantly slowed down the growth of an alternative asset class like private debt. But this has not been the case, and while fundraising by private debt managers for 2022 and 2023 might be challenging, investors are making new long-term commitments.
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Asset Class ReportsFixed income & credit – Resilience bonds
Resilience bonds aim to encourage climate investment characterised by a more forward-thinking, preventative outlook
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Asset Class ReportsFixed income & credit – Sustainability-linked bonds
Sovereigns and other issuers are yet to embrace sustainability-linked bonds but issuance is growing
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FeaturesFixed income, rates & currency: US debt crisis averted – what next?
The US debt ceiling crisis was resolved in June, avoiding potentially major fireworks, with a suspension of the limit until early 2025. This ensures that the next time the politicians have to fight about it will be after the November 2024 presidential election. Although markets were relieved at the temporary resolution, the process of rebuilding the very depleted Treasury cash balances – with some huge bill auctions planned – will drain significant liquidity from the system, which could put pressure on the rates market.
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Asset Class ReportsFixed income & credit – No turning back for alternative credit
Investor demand for alternative lending strategies remains strong as the opportunity set grows
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Country ReportItaly: Private markets allocations at a crossroads
Italian pensions funds are showing renewed interest in fixed income, as investment in private markets slows down – but long-term commitments are still in place
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Country ReportCountry report – Pensions in Italy (July/August 2023)
Italian second-pillar occupational pension funds continue on their path to diversification. Owing to the higher yields on offer in traditional fixed income markets, allocations to private markets may slow down temporarily, but funds have made long-term strategic commitments. A variety of industry initiatives is facilitating investment in private equity, private debt and infrastructure. Meanwhile, some pension funds are consolidating their private markets portfolios.
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FeaturesIPE Quest Expectations Indicator: July 2023
The war in Ukraine is starting to look like a stalemate. This would be in Russia’s favour. Delivery to Ukraine of more of the tanks promised or fighters to contest Russian air control might lead to a breakthrough, but is unlikely to happen in the summer. In the US, Trump looks like a leading but weak candidate for the Republicans, even against a Democrat as unpopular as Biden. Legal pushbacks against the fight to prevent permanent climate change, notably in Texas, have the potential to cause a trade war with the EU. They illustrate how European and North American values are slowly drifting apart.
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FeaturesIPE Quest Expectations Indicator: August 2023
Politics is on hold until September. Normally, markets do not care and analysts reduce their activity. A political crisis in the Netherlands shows the danger. There are warnings from all sides that climate measures are ever more urgently needed. Markets need a clearer view of which products govern- ments will support with market-shaping measures and when, especially in the face of a faltering pace towards climate goals. Early signs of problems include a lack of capital for innovative start-ups and the increasingly loud voices of climate change deniers.
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AnalysisAnalysis: German states realign €30bn pension fund assets to stricter ESG standards
Four German states have recently revised their sustainable investment strategies, sticking to stricter ESG rules
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NewsSwiss pension funds set to change SAA to reach bond investment targets
According to Swisscanto, 17% of pension funds surveyed adjusted their strategic asset allocation, and 35% changed allocations tactically.
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NewsMandate roundup: Swiss pension fund tenders investment grade mandate
Plus: Swedish Fund Selection Agency hands mandate to Style Analytics
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NewsGerman BVV allocates €1.5bn to high rating investment grade bonds
The fund will pursue an active risk management approach, especially in volatile asset classes
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FeaturesFixed income, rates & currency: Strong labour markets surprise
Global purchasing managers’ index (PMI) data, which measures the state of the US economy, has been mostly strong, although manufacturing indices have been considerably weaker than services, perhaps reflecting their greater sensitivity to higher interest rates.
