Executive Summary: Will the Next Decade Look Like the Last? Help Needed—Traditional Approaches Can No Longer Do It All: While traditional core and core plus fixed income strategies have historically served as a “one-stop shop” allocation to balance risk-seeking allocations,
Fixed Income Perspectives: U.S. consumer prices see their largest increase since 2008, topping all estimates. That summarizes headlines about recent inflation data. Since the beginning of this year, our view has been that the change …
In a week marked by volatility in broad risk markets related to concerns around inflation, the U.S. loan market maintained a steady pace, as the S&P/LSTA Leveraged Index (the “Index”) posted an advance of 0.09% for the seven-day period ended
The longest U.S. equity bull market in history has officially come to an end; extinguished by a viral pandemic that seemed unimaginable just three months ago. The velocity of the sell-off was also difficult to fathom. In just over one
While much uncertainty remains, one aspect of the COVID-19 market shock is clear: The Fed will not stand in the way of the economic recovery. By the end of March, the COVID-19 global pandemic had a deep and profound effect on virtually
Time to own durable yield for the Zero Interest Rate world ahead Going forward, fundamentals are likely to be defined by a sharp global recession followed by a stubbornly low growth world coupled with the odd bedfellows of high debt
Talking Points U.S. loan performance was steady this week amid volatility in other major markets stemming from talk of the potential economic impact of Covid-19. The S&P/LSTA Leveraged Loan Index gained 0.12% for the seven day period ended Feb. 20,
Voya Multi-Asset Perspectives The U.S. economy continues to do well: 3Q19 real GDP grew at 2.1% and the Atlanta Federal Reserve GDPNow is forecasting 2.3% 4Q19 growth. This would mark another above-trend quarter and three consecutive above-trend years. Consumers continue
Fixed Income Perspectives Entering the first half of 2020, our portfolios are positioned to reflect six key themes. Political Uncertainty: Slower global growth has exacerbated ongoing tensions arising from the increasingly unequal distributions of income and wealth, fueled in part by global trade
Our 2020 Capital Market Assumptions details our research on asset class returns, standard deviations of returns and correlations over the 2020–2029 timeframe. These estimates are a key input into our strategic asset allocation process for our multi-asset portfolios; they also
Good Tidings for Investors Heading into Year-End Global equities continued their climb, considerably outperforming bonds through November and the first half of December. Within U.S. stocks, relative returns across the capitalization spectrum were fairly tight. Growth outperformed value but cyclical
2020 Outlook Entering 2019, our view was that strength in U.S. consumption would sustain U.S. economic expansion. This investment thesis has largely played out (despite concerns about overleveraged corporations, weakening manufacturing, and the roller coaster ride of U.S.-China trade negotiations).
Over the past few weeks, Eurozone and U.S. economic and manufacturing data releases have started showing early signs of stabilization. In the United States, PMI data have trended sideways of late. Industrial production missed expectations, but much of the weakness
Global equities rose in September, recapturing some of August’s losses. By contrast, so-called “safe-haven” fixed income asset classes, such as long-maturity U.S. Treasurys, declined, giving back a small portion of their prior month returns. The advance in stocks was led
Voya Multi-Asset Perspectives Global equities rose in September, recapturing some of August’s losses. By contrast, so-called “safe-haven” fixed income asset classes, such as long-maturity U.S. Treasurys, declined, giving back a small portion of their prior month returns. The advance in
Fixed Income Perspectives News of negative rates in the U.S., recessionary fears, and U.S.-China trade negotiations continue to grab headlines. However, on the stage of doom and gloom, one actor is noticeably absent: Unsustainable leverage on corporate balance sheets. It
Broad market volatility spilled into the loan market this week, as the S&P/LSTA Leveraged Loan Index (the “Index”) lost -0.41% for the five business days ended Oct. 10, led lower by a 51 basis points reduction in the Index bid
Global equity markets declined over August, as trade tensions between the United States and China escalated. Throughout the month it became increasingly clear that neither side was willing to budge on its position and tariffs planned for September would indeed
The yield curve regained the limelight in August when yields on ten-year Treasury notes dipped below yields on two-year notes, the dreaded “inversion” that caused markets to sell off. Remember, an inverted yield curve represents fear of a recession; it
Oversold Conditions and Dovish Policy Shift Trigger Rebound in Stocks May’s sharp sell-off in stocks was swiftly countered by a rally in June that helped drive global equity markets to their best first half-year performance in over two decades. The
Economic growth is slowing; the question now is whether it will stabilize near trend. Global manufacturing has declined for 15 months and is still contracting; inventories are building and business confidence has diminished. Adding on to these challenges, President Trump’s
Below is an overview of the key macroeconomic developments we expect to help determine our overall risk budget and inform our bottom-up security selection process in the second half of 2019:
In June we asked which had more clout with investors, the Federal Open Market Committee (FOMC) or President Trump’s tweets. This month we got the answer: tweet trumps Fed. At its July policy meeting, the FOMC cut the fed funds
Below is an overview of the key macroeconomic developments we expect to help determine our overall risk budget and inform our bottom-up security selection process in the second half of 2019: 1. Populism—Populism is the enemy of globalization, the pullback
The S&P/LSTA Leveraged Loan Index (the “Index”) slipped 6 basis points (“bps”) for the seven day period ended June 27, led lower by a 17 bps reduction in the average Index bid, to 96.80.
Fixed Income Perspectives President Trump threw monkey wrenches into the global financial markets by suddenly escalating trade frictions with China, and then unexpectedly weaponizing tariffs against Mexico. As the hyenas advanced, the lion roared: Fed Chair Jerome Powell said that
Fixed Income Perspectives As expected, at its April–May meeting the Federal Open Market Committee (FOMC) voted unanimously to hold the Fed funds rate steady in the 2.25–2.50% range. The few changes to the press release language acknowledged the solid economic
Bumper Month and Quarter for Equities Globally Global equities and fixed income posted quarterly gains across the board with the MSCI All Country World Index and the Bloomberg Barclays U.S. Aggregate Bond Index gaining 12.2% and 2.9%, respectively. The starting
Fixed Income Perspectives March 2019 marked ten years since the trough of the financial crisis. Many pundits relished the opportunity presented by this arbitrary anniversary to prognosticate the next great market calamity. Concerns about a slowing global economy and risk
Fixed Income Perspectives March 2019 marked ten years since the trough of the financial crisis. Many pundits relished the opportunity presented by this arbitrary anniversary to prognosticate the next great market calamity. Concerns about a slowing global economy and risk
Voya Multi-Asset Perspectives Risk assets sold off markedly during December and the rates markets have fully repriced Federal Reserve rate hikes out of the market for all of 2019. The United States led the charge lower as many global equity
Six Macro Themes for the First Half of 2019 In our 2019 outlook, we highlighted the importance of positioning portfolios to avoid downside velocity. In this issue, we provide a more granular look at the key macroeconomic developments we expect
How we got here Ten years removed from 2008, it is easy to forget how much of our current investment landscape has been shaped by central banks’ unprecedented response to the global financial crisis. Unusually muted market volatility and historically
Fixed Income Perspectives Investors continue to face a market fraught with uncertainty. As far as catalysts go, the usual suspects remain. Trade war concerns, the potential for a yield curve inversion and emerging market volatility continue to grab headlines. Against
Weekly Highlights In a week highlighted by a widely anticipated rate hike by the Fed, the loan market experienced another positive advance, as the S&P/LSTA Leveraged Loan Index (the “Index”) returned 0.20% for the period, while the average bid moved
Fixed Income Perspectives august 2018 Moving into the second half of 2018, trade concerns continue to dominate the financial market narrative. While the economic impact remains to be seen, ongoing trade tensions are likely to create additional episodes of volatility
Fixed Income Perspectives The return of volatility has been the dominant headline since the beginning of the year. Fast forward to May as investors watched the ten-year yield break through 3% and reach seven-year highs. The shape of the yield
Fixed Income Perspectives Volatility has returned, and we believe it is here to stay. Market volatility spiked higher in February after rising real yields, coupled with a firmer January wage growth and inflation report, led investors to fear that Jerome
Voya Multi-Asset Perspectives February proved to be a difficult month for investors: the MSCI All Country World Index, the proxy for global stocks, weakened, losing 4.2%; and U.S. fixed income, as measured by the Bloomberg U.S. Aggregate Bond Index, fell
Refinancing activity was the main driver of senior loan issuance this week with 16 new transactions launching in what was a subdued week for fresh paper. Generally, steady was the name of the game for secondary trading, with several new
Regulatory and market conditions are encouraging more corporate plan sponsors to de-risk. This de-risking trend coupled with a potentially smaller universe of long corporate bonds is causing the portfolios of many traditional long duration managers to look exceedingly similar. Against
U.S. Credit Risk Retention Rules (“CRRR”), which were adopted on October 22, 2014 and derived from the DoddFrank Wall Street Reform and Consumer Protection Act, required collateralized loan obligation (“CLO”) managers to retain 5% risk or “skin in the game”
Weekly Highlights Volume in the primary market increased this week, with $13.2 billion of institutional loans launched, up from $7.4 billion last week. LBO and M&A-related transactions made up the bulk of activity, while recap/dividend deals experienced an uptick, accounting
Our 2018 Long Term Capital Market Assumptions details our Voya capital markets forecasts of asset class returns, standard deviation of returns and correlations over the 2018-2027 timeframe. These estimates are key inputs to our strategic asset allocation process for our
In our 2018 outlook, we argued that market conditions were likely to lead to a return of volatility. As the saying goes, be careful what you wish for — volatility has returned in a big way. Though equities made headlines,
Until last week, financial markets had been gaining ground progressively and had broken the record for most consecutive trading days without a 5% correction. All of that ended dramatically just before the above-consensus U.S. payroll report, which stoked concerns about
Weekly Highlights Despite the extreme volatility seen in equity markets this week, activity – and psychology – across the US loan market was largely unaffected. While average yields edged wider across all ratings cohorts, overall new issue pricing levels were
After 2017 proved a banner year for global equity markets, many investors wondered if markets could deliver similar returns in 2018. Global equity markets started the year off stronger than any year in the past two decades. Emerging market equities
Senior Loan 2018 Outlook As we enter 2018, the macro environment continues to remain supportive for credit markets generally. Broadly speaking, we believe corporate earnings will benefit from recent above-trend line nominal growth and corporate tax cuts, the combination of
Seasonality Wins the Day, January 2018 The U.S. equity market proved to be quite resilient throughout 2017 and December did not prove the exception. U.S. equities, which had been lagging behind their internationally developed market peers, worked to close the
