In 2007 Howard Marks released a memo titled The Race to the Bottom, the note shared his view that investment markets are like an auction house, the item that’s up for sale goes to the person willing to pay the most. When buyers are scarce the items for sale go... Show More
It has been a very active half year in the Australian Alternative Finance (AltFi) market. Since my previous wire on the key themes expected for 2018, the market has continued to grow and evolve. The themes were: 1) Continued Growth, 2) Consolidation of Lenders; and 3) Transparency via Listings. Show More
Once upon a time, the high yield bond market was for speculative companies and investors. Today, the market is where Virgin, Netflix and Hertz raise capital from institutional investors. In this short interview, Vivek Bommi from Neuberger Berman discusses how perception is still catching up with reality in this fast... Show More
The US high yield market has grown larger and riskier since the financial crisis. Issuers of debt have the whip hand as buyers compete to gain an allocation in the face of surging demand from CLOs and retail funds. Companies are emboldened to seek ever weaker covenants and are taking... Show More
You know it’s late in the credit cycle when credit investors give away their key protections in return for just a little more yield. This acquiesce comes in different forms, including higher levels of leverage, longer dated debt, subordinated debt and weakened or eliminated covenants commonly referred to as “covenant... Show More
I have been active in the Alternative Finance (AltFi) sector since 2011 and have observed significant progress across lending, payments and fintech in general in the Australian market since then. Show More
Richard Quin, Lead Portfolio manager of Bentham Asset Management, is one of Australia’s most seasoned and successful credit investors. While the asset class remains overlooked and underrepresented in many Australian portfolios, there are two bets he’s making right now that should grab your attention. The first position is that long-term... Show More
High yield bonds are tempting but come with greater chances something could go wrong. This wire gives some tips in getting the balance right between high yield and investment grade, and displays a sample portfolio for both strategies. Show More
The SME Alternative Finance (AltFi) lending market is gaining momentum in the Australian market. We are lagging the US and UK markets by about 4 years, however the growth inflection point is near in the domestic market. There are opportunities for double digit yields on the debt, whilst supporting the... Show More
Stephen Roberts says housing is coming off the boil, Fidelity’s tips on surviving the next crisis, Anton Tagliaferro talks yield stocks, and Marcus Tuck shares the results of his ASX 100 Growth & Yield screen. Here are four things you should read this weekend. Show More
This is the question most prospective investors of our managed funds and anyone interested in small cap investing ask us. Identifying investment ideas, whether it is ASX listed companies or global companies can come about many ways. It could be we stumble upon them by trawling through all the companies... Show More
Equities and credit delivered gains in May, commodities were mixed. Japan, France and Germany posted good GDP numbers, forward looking data for the US is weak. US equities are looking overvalued and a range of prominent investors have come out as selling down or going short. High yield credit is... Show More
Tim Hannon, Chief Investment Officer at Newgate Capital, thinks ‘yield’ stocks present significant risks in the current environment. “Sometimes high-yield is an extremely risky proposition.” He is concerned about the proliferation of high-yield ETFs and managed funds, as well as direct investors, bidding up the prices of these high-yield stocks... Show More
Aussie Economic data just out showed 4Qtr GDP grew +0.6% on Qtr vs Consensus expectations of +0.4%.... Basically meaning their is no rate cuts coming anytime soon with the strong domestic numbers. Equity markets remain a great place to derive income from. GO Australia, Cheers JN Show More
The vast majority of financial crises have been preceded by the rapid accumulation of debt. For recent examples, we need only look back to the sub-prime housing crisis in the United States and European sovereign debt crisis. Perhaps the defining characteristics of the current cycle are the rapid build-up in... Show More
Heavily oversold markets appeared to stabilise at the end of last week but the primary sources of nervousness remain. Exchange rates and high yield bond prices are two of the key market features having a drag on market outcomes and with an impact on the resources sector – both negative.... Show More
Many investors would be happy to see the back of 2015 as they've lost money betting on three popular themes. With the way things are unfolding, these three trades may not fare much better in the New Year. Show More
A dramatic sell off in high yield debt has begun destabilising markets. However, as the first chart illustrates, the crash in prices has been a long time in coming. The upward drive of high yield bond prices, supported by Federal Reserve monetary polices, has been losing momentum possibly since as... Show More
It has been nearly a decade since the US market has seen and interest rate rise, so what does a 'normal' setting look like? Jarod Dawson, Director at PM Capital, says investors should be cognisant of the level of stimulus that has been injected into the US economy and that... Show More
National Australia Bank has been placed in a trading halt amid reports that Nippon Life will buy about 80 % of the bank's life insurance business. Japanese news outlet Yomiuri reported Nippon would own about 80 per cent of the unit, according to Bloomberg. In its request for a trading... Show More