We analyze how the airline industry is managing though the recent spike in energy prices.
Just when the airline industry seemed poised to put the COVID-19 pandemic in its rearview mirror, the recent oil price shock presented a new challenge. In March, analysts were quick to take earnings estimates down on the common belief that the airlines would be slow to pass on the added cost to the consumer. However, initial data points are indicating something much different. Airline management teams are guiding to a strong demand environment that will allow price increases to offset rising fuel costs ...
In market volatility, some favor adjusting exposure via passive vehicles, but we believe a more nuanced, active approach is where real opportunities lie.
With passive investments, investors can seek to quickly and efficiently gain exposure to credit assets when markets are down and withdraw after they have risen. However, in our opinion, active credit strategies are a better way to take advantage of market opportunities that volatility creates, particularly in today’s environment.
Let’s take the Global Corporate Index. It represents 17,000 bonds, across approximately 19 sectors and rating bands.
With yields back to more normal levels, European fixed income is once again providing a compelling arena for active managers.
After years of trading at negative yields, euro-denominated bond markets are finally looking normal again. The flagship market segment—investment grade corporate bonds—is currently trading at a yield level that we haven’t seen for nearly a decade, even at the height of the COVID crisis.
The average yield for the Bloomberg Euro Aggregate Corporate Index is currently above 2.30%—a rapid change from hovering near zero just nine months ago. This repricing came ...
When inflation, interest rates and global economic uncertainty are rising, cash today can seem more urgent than exposure to the markets of tomorrow—but could that mean investors risk missing out on the potential of thematic strategies?
Regardless of whether we get a hard or soft landing, we likely face a steep approach to the runway in trying to “land this plane.” The question is, how well consumers and companies absorb the slowdown, and whether sentiment is already bearish enough to create long-term value.