‘EMD is more than a currency play’
Investors still too often view emerging market debt (EMD) as a simple choice between hard and local currency. That’s a missed opportunity, says Cathy Hepworth, who established PGIM Fixed Income’s EMD team 30 years ago. According to her, the true strength of the asset class lies in its diversity.
Cyclical sectors benefit most from artificial intelligence
The development of artificial intelligence (AI) is set to transform many industries. In addition to the software sector, heavy industry and mining may be among the biggest winners, according to experts.
Dull dividend stocks are making a comeback
The underweighting of expensive U.S. growth stocks is playing into the hands of dividend strategies. Investors are once again showing interest in boring companies with stable dividends.
‘Only a deep recession can seriously threaten high yield’
According to experts, it takes a lot to bring down the global high-yield market. The high effective yields help absorb rising credit losses in a recession.
Oil stocks are a very cheap hedge against inflation
The energy sector serves as a safe haven during periods of geopolitical turmoil and is showing greater investment discipline. However, an increasing oil supply is dampening short-term expectations.
Analysts surprised by European bank rally
European banks are in solid financial shape, and interest income is exceeding expectations. Still, bank analysts are raising eyebrows at the sector’s sharp rally.
Healthcare sector back in the spotlight
Stock prices in the healthcare sector are on the rise. Innovation is driving growth, and investors appreciate the defensive qualities of the sector, experts say.
“Little interest in multi-asset funds”
Mixed funds have been experiencing a strong net outflow of assets for two years. A lower interest rate could reverse the negative trend, but for now, investors show little interest, said Morningstar analyst Thomas De fauw.
Strong inflow into European equity ETFs, thanks in part to Financials and Industrials
European equity ETFs have experienced a strong net inflow this year. Although the market is driven in the short term by news, investors are ready to expand their positions. Both the inflow into financials and that into industrials is noteworthy.
‘Fantastic returns on cat bonds’
The increased likelihood of natural disasters due to climate change does not make investing in catastrophe bonds (cat bonds) any less attractive. On the contrary, experts say that due to the rising capital needs of reinsurers and higher premiums, returns can actually increase.