Viewpoints

Conversations - 6 min read

EM Debt: Warding Off Headwinds with Active Management

Ricardo Adroguè, Head of Global Sovereign Debt and Currencies, addresses the many risks facing the global economy—specifically China, Argentina and the Middle East—and explains why active management is critical to performance.

High Yield: Rates, Recessions and Relative Value

While there is no shortage of risks to consider in today’s high yield markets—from ESG to the end of the credit cycle—Barings’ Martin Horne describes how taking a contrarian approach can help investors uncover pockets of value.

Podcast - 30 min listen

Sentiment Shift Fuels Lower-Rated Rally

Uncovering relative value across high yield in 2020 may require looking in less obvious places.

EM Local Debt’s Time to Shine?

Emerging markets (EM) local currency denominated debt may be poised to outperform.

Risk-on, Risk-off & Repeat

Sentiment continues to swing back and forth in the collateralized loan obligation (CLO) market, but bifurcation remains the constant.

Rates, Rallies & Risks

Investment grade credit markets posted a banner year in 2019; can the good times continue to roll?

Equities

Comeback Time for International Equities?

Because the U.S. equity market is broad and deep, there will almost always be opportunities—but in aggregate, we think international equity markets may be more compelling over the next year.

Alternatives

U.S. Real Estate: More Reward in Core?

As investors in the market continue to chase yield, the risk premium—or the reward for taking that risk—appears to be diminishing. In this environment, we’re seeing some of the best opportunities in the highest-quality assets.

Alternatives

The Continued Democratization of Private Equity

Private equity is an asset class that has traditionally been available only to very large, sophisticated institutional investors. But this is changing rapidly—a trend we expect to accelerate in 2020.

Amid Rising ‘Mequity’ Risk, Boring Can Be Beautiful

In both the U.S. and Europe, there is significant pressure both at the top and bottom ends of the middle market. As a result, we’re seeing potentially attractive value today in the more traditional, true middle market.

How Crucial is a Weaker Dollar in Supporting an EM Rally?

As concerns of a near-term recession seem to have dissipated, we think—in what may be somewhat of a contrarian call—riskier assets look well-positioned to potentially outperform in the year ahead.

A Bright Spot in Higher-Yielding EM Corporate Debt

Many EM regions have been engulfed in uncertainty for weeks or months. While these situations certainly represent risks, we also continue to find value—often in globally diversified companies that have been unfairly punished by markets because of where they’re domiciled.

2020: An Inflection Point for EM Currencies?

With the financial crisis more than a decade behind us, the global financial system seems poised to begin re-leveraging. This process, which would likely take years to play out, would provide a source of funding for EM currencies, and represent a significant tailwind.

Fear of Fallen Angels May Be Overblown

Many headlines over the last year have called attention to the growth of the lower-rated BBB portion of the investment grade market—and predicted a wave of fallen angels to high yield. But in the last year, we have seen more HY companies upgraded to IG than the other way around.

Europe's Time to Shine?

If Brexit headwinds begin to clear, and the German economy sees improvement, it would support the European economy as a whole. At the same time, any weakness in the U.S. dollar could further propel international markets, potentially reversing a decade of underperformance.