Counting Yens

Fixed Income

While fixed income investing offers many benefits, low interest rates and a growing pool of potential choices have made finding the right investments more challenging. 

Benefits of investing in fixed income

Investing in fixed income has a number of potential benefits:

Can preserve capital

portofolio diversification

Why an active approach?

Our approach to fixed income

Income generation

Potentially lower risk than equities

We think an active investment approach is more likely to provide a better return over the long term than a passive solution and to help you achieve your investment objectives. 

Fixed income markets can be complex and the long-running expertise of our specialist investment managers means they may be able to uncover opportunities that others might miss, whilst protecting capital when needed.

Fixed income is a core strength for our firm and we offer a wide range of strategies including global, regional and emerging markets, corporate debt, and money market funds. We also offer more specialist strategies such as absolute return and hedge funds.

“Our priority is ensuring that each one of our independent fixed income teams focuses only on investing, while benefiting from the support of our wider platform.”

James Goldstein, Head of Fixed Income

Investing for a better future

Sustainability has long been central to our company, which is why we are at the forefront of our industry in incorporating environmental, social and governance (ESG) criteria into all our investment processes – not least for our fixed income strategies.

Integrate ESG factors into all investments processes

Engage with companies and goverments

Exercise voting rights

Act as stewards of responsible investing

Be transparent with clients on EGS criteria

What are the risks?

As with any other investment, investing in fixed income carries risks. It’s therefore important to find an experienced manager to manage these.

Investments in fixed income may be subject to the default/credit risk of issuers, interest rate risk as bond prices move inversely to changes in interest rates, and liquidity risk. Investing in higher-yielding or non-investment grade bonds might mean the risk of the issuer defaulting on the capital repayment is higher.

These strategies could also invest in emerging markets, where investments can be higher risk and more volatile, or denominated in a foreign currency meaning a change in exchange rates could affect their value. They may also use derivatives which carry similar risks, or use leverage. Investments are subject to the risk of material losses resulting from human error, systems failures or the incorrect valuation of the underlying securities.

Past performance is not a guide to future performance. The value and income of an investment can fall as well as rise and you may not get back the amount originally invested.

 

WAYS TO INVEST

Emerging Market Bonds

We believe that the fast-growing economies of emerging markets offer investors the potential for sustainable, long-term returns, particularly via their large sovereign and corporate debt markets.

We offer multiple ways to access emerging market bonds:

Global
Provides access to some of the world's fastest growing economies from a potential investment universe of 60+ emerging market countries. This broad approach provides wide-ranging investment opportunities whilst spreading potential risks. 

Hard currency 

Provides exposure to emerging market bonds without taking on currency risk. This is the most established emerging market debt asset class, comprised of sovereign and corporate bonds issued in major currencies such as US dollars or Euros. 

Local currency

Provides exposure to emerging market bonds without taking on currency risk. This is the most established emerging market debt asset class, comprised of sovereign and corporate bonds issued in major currencies such as US dollars or Euros. 

Corporates

Provides access to the fast-growing opportunity in emerging market corporate bonds, denominated in major currencies such as US dollars or Euros. 

Short-term

Invests in either corporate or sovereign debt and offers a degree of protection from rising rates by focusing on securities with a short duration. Seeks to provide stable and attractive income with limited volatility.

Sustainable blend

Provides diversified emerging market debt exposure with a focus on ESG factors. As a blended approach, it combines our best ideas from both emerging market hard and local currency bonds. 

Regional

Bond strategies which focus on regions such as Asia, China, and Latin America, and which seek to capture the vast range of opportunities available in these dynamic markets through a combination of our local expertise and broad research capabilities.

Developed Credit

Developed markets offer a vast pool of investible debt securities across both governments and corporates. We offer a wide range of strategies for investors to suit their investment objectives and risk appetite. Our strategies invest across a range of assets, from the lower-yielding bonds issued by high-quality companies and governments to the higher-yielding bonds issued by lower-rated companies. We offer strategies in a range of developed market currencies such as US dollars or Euros.

Absolute Return

Absolute return fixed income
Traditional fixed income strategies seek to provide a relative return in excess of a benchmark index. ASW Absolute Return Fixed Income and ASW Global Fixed Income Opportunities, on the other hand, are unconstrained by benchmarks and so can invest wherever our managers see the best opportunities. Each has a different risk-return profile designed to meet different investor needs, and we place particular emphasis on liquidity and reducing volatility.

Fixed Income Hedge Funds

With our strong experience in both fixed income and hedge funds, combining the two and expanding our investment offering to fixed income hedge funds was a natural progression. We offer the following:

Global credit hedge fund
Investors who want to protect against a market correction in the current low-yield, high-valuation environment might consider a global credit hedge fund strategy. The strategy can act defensively by allocating less when assets are expensive, and can extract the relative value from taking long/short positions in credit. 

Global macro emerging markets fixed income

The case for investing in emerging markets is clear, but emerging market assets are too often subject to volatility – emerging stocks, bonds and currencies can all experience bouts of turbulence. ASW offers a solution which provide access to these assets for investors, but with lower volatility. The strategy aims to generate a positive risk-adjusted return in all market conditions by the use of long/short positions, as well as the ability to invest in a broad selection of assets.

EU Bonds

Our expertise allows us to offer investors a broad range of EU bond solutions including: active, semi-active passive and Socially Responsible Investment (SRI). Our investment style is more strategic than tactical, is fundamental and is based on a strong capital protection discipline.

Global Bonds

Our global bond strategies seek to identify the most attractive opportunities from the largest pool of all – the global bond market, at over $115trn in size. We offer both a flexible approach to bond investing, as well as one which focuses on the fundamentals – a country’s ability and willingness to repay debt. In doing so, we create high-quality bond strategies to suit investors’ investment objectives.  

Money Markets

What makes us different is that we invest in a broader opportunity-set of assets than a typical money market manager. We offer an established range of funds, domiciled across the globe, and in various currencies. These include: sovereign short-term money market; short-term money market; enhanced liquidity and ultra-short-term bond. The funds are compliant with the new European and global Money Market Regulation.

We have been focusing on our fixed income business since we started, adding to our capabilities to meet client needs.

Our experts

New York

Fixed Income

ASW

+1 332 205 6058

info@alpha-sw.com