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Pictet Asset Management: A V-Shaped Recovery After All?

An economic recovery appears to be gathering pace. That means emerging market stocks, and some cyclical sectors, are looking more attractive.

It’s looking increasingly like a V-shaped economic recovery. True, in some regions the bounce back has been a little less robust. But in others, notably China, economic conditions are largely back to where they were pre-Covid – in July, industrial profits were up 20 per cent year on year. Meanwhile, after reviewing its approach to monetary policy, the US Federal Reserve has formally become a much more dovish institution at the margin, though it stopped short of a radical overhaul anticipated by some in the market.

Markets have noticed. Yet after a powerful rally across all assets during the past few months – sending leading US stock market indices to record highs – we feel that prospects for further broad-based gains are limited, with greater divergence among regional markets.

So while governments may yet offer more fiscal stimulus, not least in the US, liquidity provision is slowing worldwide. There are also political risks associated with US elections in November. And all the while there’s Covid-19. Not only is there the possibility of a significant second wave of the virus, but there is also little clarity on how soon a vaccine might be developed. At the same time, Shinzo Abe’s decision to step down after being Japan’s longest-serving prime minister introduces some uncertainty around geopolitics and the possibility that the world’s third largest economy will change its policy approach.

As a result, we remain neutral on all the major asset classes, though within equities we favour more cyclical sectors.

Our business cycle indicators show that the economic recovery is proving to be strong enough to warrant an upgrade to our 2020 economic forecasts. Our economists now expect full year global GDP to come in at -4 per cent from -4.2 per cent previously, but next year’s forecast has been cut to 6.1 per cent from 6.4 per cent.

In the US, retail sales have registered the strongest and fastest ever rebound after the deepest and quickest downturn in history to where they’re now – running at above pre-recession peak. Most past cycles have taken at least three years to play themselves out. This time, it’s been only a little more than three months. Retail sales are also back to trend in the euro zone.

However, it’s notable that only China’s real-time indicators are back to pre-Covid levels. Elsewhere, they’ve flattened out at between 10 per cent and 20 per cent below.

And while inflation could yet prove to be a risk if demand remains firm and supply fails to catch up, that’s not likely to be an issue until the back half of 2021.

Global liquidity conditions remain very supportive, with new liquidity creation running at 25 per cent of GDP, but there is clear evidence that monetary stimulus growth has peaked [see Fig. 2]. At the same time, banks are tightening credit standards. And the Chinese central bank is now at neutral, while the country’s credit surge has tapered back down.

One upside liquidity risk, though, is that US Treasury cash balances held by the central bank could be drawn down.

Our sentiment indicators paint a mixed picture. The balance of equity calls to puts suggests a degree of market complacency, and our indicators show hedge funds have crowded into a handful of concentrated positions, particularly in the largest of the large cap stocks. On the other hand, retail investors seem cautious about shares and sentiment surveys remain depressed, while fund manager positioning in the asset class is below historic trend. A “wall of cash” remains, with some recently flowing into bonds and credit – both appear overbought.

Finally, our valuation indicators suggest equity prices look stretched after a 50 per cent rally in the S&P 500 – on our models, they are at their most expensive in 12 years, trading two standard deviations above their 6-month moving average. Even relative to bonds, equity valuations no longer look particularly cheap. The gap between the global earnings yield and global bond yield is at its lowest in a decade at 4.5 percentage points. But we’re not yet into bubble territory. If current low bond yields, which have fallen 100 basis points this year, are sustained, this valuation impact on US equities exactly offsets the 20 per cent decline in earnings. Our valuation score on equities has moved from negative in January, to strongly positive in March and is back down to negative now.

Please click here for more information on Pictet AM’s Investment Outlook.

Information, opinions and estimates contained in this document reflect a judgment at the original date of publication and are subject to risks and uncertainties that could cause actual results to differ materially from those presented herein.

Important notes

This material is for distribution to professional investors only. However it is not intended for distribution to any person or entity who is a citizen or resident of any locality, state, country or other jurisdiction where such distribution, publication, or use would be contrary to law or regulation. Information used in the preparation of this document is based upon sources believed to be reliable, but no representation or warranty is given as to the accuracy or completeness of those sources. Any opinion, estimate or forecast may be changed at any time without prior warning. Investors should read the prospectus or offering memorandum before investing in any Pictet managed funds. Tax treatment depends on the individual circumstances of each investor and may be subject to change in the future. Past performance is not a guide to future performance. The value of investments and the income from them can fall as well as rise and is not guaranteed. You may not get back the amount originally invested.

This document has been issued in Switzerland by Pictet Asset Management SA and in the rest of the world by Pictet Asset Management Limited, which is authorised and regulated by the Financial Conduct Authority, and may not be reproduced or distributed, either in part or in full, without their prior authorisation.

For US investors, Shares sold in the United States or to US Persons will only be sold in private placements to accredited investors pursuant to exemptions from SEC registration under the Section 4(2) and Regulation D private placement exemptions under the 1933 Act and qualified clients as defined under the 1940 Act. The Shares of the Pictet funds have not been registered under the 1933 Act and may not, except in transactions which do not violate United States securities laws, be directly or indirectly offered or sold in the United States or to any US Person. The Management Fund Companies of the Pictet Group will not be registered under the 1940 Act.

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In Canada Pictet AM Inc is registered as Portfolio Managerr authorized to conduct marketing activities on behalf of Pictet AM Ltd and Pictet AM SA. In the USA, Pictet AM Inc. is registered as an SEC Investment Adviser and its activities are conducted in full compliance with the SEC rules applicable to the marketing of affiliate entities as prescribed in the Adviser Act of 1940 ref. 17CFR275.206(4)-3.

Banorte Securities International Relocates U.S. Headquarters to Houston

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Banorte-Ixe Securities International, member FINRA and SIPC, an investment management and brokerage service company, has relocated its U.S. headquarters to Houston. Led by a new and experienced management team, the relocation of the headquarters closer to the company’s client base and the expansion of technology-infused product offerings marks a pivotal shift in the company’s operating strategy.

A subsidiary of Grupo Financiero Banorte, the second-largest financial institution in Mexico, BSI applies the same time-tested, relationship-driven approach to providing investment solutions to a growing base of Mexican and domestic clients.

“Our relocation of the U.S. headquarters to Houston is the start of a new chapter for Banorte Securities,” said Grupo Financiero Banorte’s Private Banking Managing Director, Luis Pietrini. “With a new seasoned management team at the helm and an expanded array of technology-driven products to appeal to our sophisticated clientele, we are committed to extending the same trusted expertise fueling Banorte in Mexico for the past 100 years to clients across North America.”

BSI’s brokerage services offer numerous investing options including mutual funds, equities and fixed income products, while the company’s advisory services deliver a globally diversified investment strategy tailored to meet client’s specific short and long-term financial objectives.

BSI’s newly instated management team is led by Houston-based CEO Xavier Ibarrola. Ibarrola came to the company from the BBVA Group where he spent more than 20 years in investments and financial management positions.

In addition to unveiling the company’s new headquarters and announcing its leadership team, BSI is expanding its product offerings to existing, Mexican-based clients with the launch of BAM Digital. Created in partnership with BlackRock, BAM – Banorte Asset Management – Digital is BSI’s first-ever fully digital investment alternative. Easy to access via the website or through an app, BAM Digital features globally diversified portfolio options designed by BlackRock and backed by a team of seasoned advisors.

“Everything we do at Banorte Securities is designed specifically with our client’s needs in mind,” said Banorte Securities CEO Xavier Ibarrola. “As our clients become increasingly tech-savvy and ‘hands on’ in their personal financial journey, developing an easy to use, fully digital investment platform was the logical next step in growing our market segments and building stronger, long-term relationships with our clients.”

Ibarrola continued, “We are eager to unveil BAM Digital to our existing clients in Mexico and look forward to introducing this fully-digital platform to our domestic clientele in the near future.”

While BSI’s headquarters is located in the Galleria area, the company maintains a branch in The Woodlands, a suburb north of Houston, and plans to expand across Texas, as well as Miami and San Diego in the coming years. In addition to providing brokerage and advisory services, Banorte Securities will host a variety of programs aimed at empowering customers on their personal financial journeys.

“Houston’s proximity to a large portion of our client base, growing economy and connection to Banorte’s Mexican culture makes it the perfect home for Banorte Securities’ U.S. headquarters,” continued Ibarrola. “We are excited to deepen our roots in Houston and look forward to helping this amazing community – clients and nonclients alike – achieve their financial goals.”

Located at 5075 Westheimer Road, the company’s new 10,000-square-foot headquarters currently houses 24 full-time employees with space to accommodate 42 total employees in the years to come. Designed by AMB Architects, the open concept office infuses flares of Mexican/Houston culture through brightly colored pops of graffiti art décor including two 6 by 8–foot custom murals.

What Will the Post-COVID World Be Like? More Debt, More Government, and More Asia

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Luca Paolini Pictet AM_0 — Luca Paolini, Pictet Asset Management. Luca Paolini, Pictet Asset Management

The longest economic expansion and market upward cycle in history came to an end with the outbreak of the pandemic. A major part of this long extension of the cycle is explained by the superior performance of U.S. and technology sector equities, which have performed close to 10.8% over the past five years. In fixed income, investment grade corporate bonds and U.S. Treasury bonds provided the highest yields. At 5.7% and 5.6% per year respectively, they far outperformed European debt yields.

In looking ahead to the next five years, Pictet Asset Management believes it is inevitable to consider the long-term implications that the pandemic will have on the economy and the markets. Although it is still early to draw conclusions, Luca Paolini, the management company’s Chief Strategist, says that the pandemic has been more a factor in accelerating existing trends rather than a catalyst for new ones.

As the economy recovers from the impact of the Coronavirus, it appears that the underlying growth trends in the global economy have remained intact. However, Paolini highlights three aspects that, in his opinion, represent a change in this new phase of recession: more debt, more government interference, and more Asian leadership.

The significant increase in debt

Both the level of government deficits and the level of corporate leverage are at record highs. Currently, the level of public debt as a percentage of GDP in developed economies is close to 120%. This is close to the level experienced in the 1940s, but there is a difference. At that time, demographics were much more favorable and potential growth was stronger, making it easier to free oneself from the burden of debt.

The problem facing the global economy now is how to move forward with such a high level of debt in an environment where political austerity is no longer considered an option. At this point, it is necessary to keep in mind that when you start a cycle with a high level of debt it is very difficult to create growth. As Paolini explains, the most obvious solution is an accommodating monetary response to support government spending. After a crisis of great dimensions, the population is going to require greater social aid from the governments and this can be financed at a lower cost if the central banks maintain their accommodating policies.

Greater government involvement in the global economy

From the pre-COVID position in which governments played a regulatory role and private interests dominated, there is a shift to a new scenario in which the public interest is given priority. As a result, greater government intervention can be expected, both in terms of legislation, such as minimum wage issues, and in industrial policy issues, where sectors considered strategic will receive greater attention, seeking national autonomy and sufficiency.

A greater role for Asia in the global economy

The Asian region has clearly emerged stronger from this crisis. Their economies have a higher manufacturing component and a strong technology sector, something that has clearly played in their favor and made them more resilient. In the debt markets, Chinese sovereign bonds are proving to be a more interesting option than corporate debt in developed markets, as they are currently trading at a record spread against US Treasury bonds. The People’s Bank of China has been less expansionary than other central banks, so it has more room for maneuver and the risk of inflation is lower. Meanwhile, in the Chinese stock market, stocks show cheap valuations and the renminbi is also at favorable levels.

What is the next step for central banks?

Central banks in major economies have fewer and fewer instruments to try to revive the economy. The Federal Reserve, the European Central Bank, the Bank of England, and the Bank of Japan have all implemented quantitative easing programs including government and corporate bond purchases. All have offered subsidized loan programs to their banks and have kept indications on the future direction of their monetary policy (forward guidance). In addition, some central banks, such as the European Central Bank and the Bank of Japan, have experimented with negative interest rates.

Recently, the Fed has revised its inflation target and soon we may see the implementation of formal or informal instruments that exercise control over the yield curve. In Paolini’s opinion, the extreme version of monetary financing implied by modern monetary theory (MMT) is not ruled out for now.

With all this intervention, investors should be concerned about the possible impact that these actions by central banks may have on asset class valuations. The market consensus on this issue seems to be that, as central banks continue to issue money, asset prices can only go up. In Paolini’s opinion, this is a very simplistic version of reality, but he recognizes that the fact that central banks have injected a huge amount of liquidity into the markets is supporting valuations in a way that would have been unthinkable just a few months ago.

Equities remain more attractive than government bonds

A decade of qualitative easing and accommodative monetary policies has made it very difficult to find value in the markets today. For example, the dividend yield on the S&P 500 index is 1.6%, while the yield on US sovereign debt is 0.6%; if you take an average of these yields, the current yield on a balanced portfolio is less than inflation. Currently, most assets are at levels of valuation that would typically be associated with a period of expansion, while the reality is that we are in a period of recession.

Financial repression, understood as a situation in which bond yields are artificially kept below GDP growth, has undergone a significant change from the previous year. If the expectation a year ago was that bond yields would increase – even if not significantly – today interest rates are expected to remain lower for longer, with all the implications this has for financial assets.

Another issue to consider is that, although GDP growth and monetary stimuli are not very different from those seen in the last 10 years, there will be a significant change in regional leadership, especially in the equity market. If the undisputed leader of the last bullish market cycle was the United States, in the bullish cycle that began in March a rotation could be expected. As has been the case for the last 30 years, it is very likely that another market will start to pull the strings, so Paolini comments that it is a good time for the American investor to diversify his portfolios between Europe and emerging markets.

For Pictet AM’s Secular Outlook report, detailing key market trends and investment insights for the next five years, download here

Important notes

10 Ways the Longevity Economy is Changing the Way We Live Now

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Unsplash Amanecer Pixabay — Pixabay CC0 Public DomainUnsplash. Unsplash

Longevity is about ‘whole of life’ – not just end of life. People of all ages are likely to use goods and services that come under this umbrella – which includes wellness, health and medical treatments as well as silver spending, senior care and funeral services.

Below, Peter Hughes and Dani Saurymper , Portfolio Managers at AXA IM, highlight how the longevity economy is impacting peoples’ lives worldwide and show how they are benefiting from the innovations and solutions being offered by a wide variety of companies.

1. Your workout

Keeping fit and healthy is important for a longer life. People over 65 are the UK’s most frequent gym goers, with gym usage peaking at age 72, according to a study by Nuffield Health[1]. But many regular gym-goers have had to stay at home during coronavirus lockdowns, and have turned to trying virtual exercise classes at home. Low-cost European gym provider Basic Fit has an app that offers a range of programmes for training at home, including virtual classes and a personalised nutrition plan.

2. Seeing the doctor – virtually

Sometimes it can be difficult to schedule a doctor’s appointment, especially if you need to fit it around work or family responsibilities. And during the coronavirus pandemic, many medical practitioners have preferred to conduct online or video consultations. Global virtual care provider Teladoc Health saw total visits increase 92% to two million in the first quarter of 2020, as the coronavirus pandemic took hold[2]. Its services include being able to a speak to a doctor or mental health specialist over the phone, uploading photos for a dermatologist to review and getting a prescription that can be sent electronically to the pharmacy for you to collect.

3. Home treatment

If you are unwell or have had an operation, studies have suggested that recovery at home leads to shorter hospital stays, reducing the burden on hospital beds without a negative impact on patient outcomes[3]. But sometimes professional help is needed, for instance physical therapy or wound care. Amedisys is an example of one of the companies offering home health visits across the US, aiming to help their patients keep their independence and quality of life.

4. Managing an ongoing condition

Six in 10 US adults have a chronic disease[4] and the need to manage an ongoing condition is a global theme. Medical innovations and the use of digital technology have made managing chronic diseases such as Type 2 diabetes much simpler. For instance, Dexcom offers a glucose monitoring system which can send an alert to your smartphone if your blood sugar levels become too low. In addition, medical technology company Masimo has a product for use at home that can measure oxygen levels, pulse rate and more.

5. Optimising your health

Vitamins and supplements are also a big market, with key players including Reckitt Benckiser – who says its Digestive Advantage is the number one probiotic gummy brand[5]. A National Health and Nutrition Examination Survey found that around one in two US adults supplement their diet with vitamins[6]. Meanwhile the European dietary supplements market was worth $14.3bn in 2018 and is expected to reach $20.9bn by 2026[7].

6. And not forgetting your pet

Almost 50% of US households own a pet according to the latest US census data[8] with owners spending $528 per year on average[9]. Meanwhile the Asia Pacific region is seeing the highest growth globally in sales of cat and dog food, as pet ownership there increases[10]. Many people own pets for companionship or to encourage them to take exercise, such as walking a dog.

But having a pet means caring for them when they are sick and keeping up with regular treatments as well as their changing needs as they age. Petcare firm Zoetis is an example of one of the companies in this space that is innovating to develop new products and solutions for animal health.

7. Improving your career prospects

As we are living longer and the world changes more quickly – for example via digitalisation – we cannot expect everything we learned at school or university, or even in our early 20s, to still be enough – or relevant – throughout our working lives. You might choose to study to improve your skillset or advance your career or retrain to change jobs. Many employers also offer their workers the opportunity to gain qualifications as a way of retaining staff – for instance, through Strategic Education’s Degrees@Work programme.

8. Protection

Many people choose to take out critical illness cover which pays a lump sum on diagnoses of a covered condition, to help protect against unexpected financial hardship – for instance not being well enough to continue working. During the global coronavirus-driven lockdowns, British multinational insurer Prudential found that downloads of its digital health app more than trebled between early March and mid-May[11] and said it was expanding the number of products that could be sold virtually.

9. Self-care

Over the next 10 years, over 50% of the growth in consumer spending in developed countries is expected to come from the over-60s[12]. And most of us don’t just want to live longer, we want to live healthier for longer. Personal care is an important way we can contribute to this goal. Whether you’re buying Curel moisturising cream to care for your skin (owned by Japanese company Kao) or just topping up on everyday essentials such as Colgate (owned by Colgate-Palmolive), the 60-plus age group has significant spending power – and often more time to shop.

10. Leisure

Travel and tourism among the older generations is growing and it is estimated that by 2050 the over 60s will account for more than two billion trips annually[13]. It is undeniable that the coronavirus pandemic, has put immediate pressure on travel and tour operators. However, in many cases, travellers have already rescheduled their trips for 2021. For instance, Royal Caribbean Cruises said in May that bookings for 2021 are already in historical ranges and at higher prices compared to the same time in 2019.[14]

Despite the coronavirus outbreak, global populations continue to age, and we expect global life expectancies to creep higher over the longer term. So, although we may see some changes in consumption patterns post-COVID-19, the key drivers of the longevity economy remain intact. For investors with a longer-term investment horizon, these are key structural growth trends, which combined with shifting demographics can provide some interesting opportunities.

To learn more about this topic, please contact Rafael Tovar, Director, US Offshore Distribution, AXA IM.

Notes:

[1] Source: Nuffield Health, 22 March 2016

[2] Source: Teladoc, 29 April 2020

[3] Source: Early Discharge Hospital at Home, 26 June 2017

[4] Source: Centers for Disease Control and Prevention, 23 October 2019

[5] Source: Reckitt Benckiser. Based on unit sales through 28 March 2020

[6] Source: Trends in Dietary Supplement Use among US Adults From 1999–2012, 11 October 2016

[7] Source: Fortune Business Insights

[8] Source: United States Census Bureau, 16 May 2017

[9] Source: United States Census Bureau, 11 April 2019

[10] Source: Petfood Industry.com, 2 October 2019

[11] Source: Prudential, 14 May 2020

[12] Source: McKinsey Global Institute, Urban World: The Global Consumers to Watch, April 2016

[13] Source: World Tourism Organisation via Tourism and Leisure Behaviour in an Ageing World by Ian Patterson, CABI, 2017

[14] Source: Royal Caribbean, 20 May 2020

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This promotional communication does not constitute on the part of AXA Investment Managers a solicitation or investment, legal or tax advice. This material does not contain sufficient information to support an investment decision. Due to its simplification, this document is partial and opinions, estimates and forecasts herein are subjective and subject to change without notice. There is no guarantee forecasts made will come to pass. Data, figures, declarations, analysis, predictions and other information in this document is provided based on our state of knowledge at the time of creation of this document. Whilst every care is taken, no representation or warranty (including liability towards third parties), express or implied, is made as to the accuracy, reliability or completeness of the information contained herein. Reliance upon information in this material is at the sole discretion of the recipient. This material does not contain sufficient information to support an investment decision. Before making an investment, investors should read the relevant Prospectus and the Key Investor Information Document / scheme documents, which provide full product details including investment charges and risks. The information contained herein is not a substitute for those documents or for professional external advice. The products or strategies discussed in this document may not be registered nor available in your jurisdiction.

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Understanding megatrends

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Si Janko Ferlic Library Biblio Pixabay — Pixabay CC0 Public DomainFoto: Si Janko Ferlic. Foto: Si Janko Ferlic

The analysis from Pictet Asset Management’s research partner CIFS sheds light on the structural trends transforming the world, helping us build better investment portfolios.

Pictet Asset Management has been working with the Copenhagen Institute for Futures Studies (CIFS) for over a decade to establish a deeper understanding of megatrends – the powerful secular forces that are changing the environment, society, politics, technology and the economy. CIFS is a leading global think tank and consultancy. CIFS uses a wide range of research methods, developed over the last 40 years, which include megatrend analysis, scenario planning, risk management, innovation initiatives and strategy development.

Through our partnership with CIFS, we have devised an investment framework that incorporates CIFS’ 14 megatrends. The framework – which includes trends such as Demographic Development, the Network Economy, Focus on Health, Sustainability and Technology Development – enhances our thematic equity capabilities and informs the construction and development of our thematic equities strategies such as Water, Robotics or SmartCity.

As CIFS’ partner, Pictet Asset Management has access to research into areas not normally covered by the investment analyst community such as changes in societal attitudes and beliefs, the impact this has on the environment and the business sector, and the acceleration of technological development. We are proud to be associated with CIFS and would like to share some of their research with you.

For more information, please download the reports here, the reports are only available in English.

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XP and Ashmore Announce Partnership to Offer Brazilian Investors Strategies Focused on Emerging Markets

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São_Paulo,_Brazil_(3) — Wikimedia Commons. XP y Ashmore anuncian un acuerdo para ofrecer a inversores brasileños estrategias de mercados emergentes

XP Inc., a leading, technology-driven financial services platform, and Ashmore Group PLC, a specialist asset manager with over twenty-five years’ experience investing in Emerging Markets, announce a partnership to offer Brazilian investors easy access to actively-managed Emerging Markets equity and credit strategies.

XP recently launched three local feeder funds for qualified individual and institutional investors that invest directly into three Ashmore strategies: Ashmore Emerging Markets Debt Advisory FIC FIM IE CP (BRL hedged), Ashmore Emerging Markets Equity Dólar Advisory FIC FIA IE (unhedged-US) andAshmore Emerging Markets Equity Advisory FIC FIA IE (BRL hedged).

“Emerging Markets will continue to be the dominant drivers of global economic growth with highly attractive returns, particularly when set against the backdrop of persistently low interest rates in the developed world. Ashmore’s strategies, through the XP platform, provide Brazilian investors with the opportunity to diversify their portfolios and to enhance potential investment returns”, stated both companies in a shared statement.

Leon Goldberg, partner at XP said: “Through this partnership with Ashmore, XP is pleased to offer the first emerging markets strategies on its platform, easily accessible by clients through local funds. The choice of Ashmore, a global top-tier manager, as a partner reinforces our sense of continuous evolution and the search for international partnerships that support the idea of intelligent international portfolio diversification considering the excessively domestic bias still seen in investments in Brazil.”

George Grunebaum, Ashmore’s Head of Distribution for Latin America commented: “Ashmore is honoured to partner with XP to provide Brazilian investors with access to the attractive growth and return opportunities available across the Emerging Markets. Ashmore looks forward to sharing its specialist focus, active management philosophy and deep experience of investing in the Emerging Markets with XP in order to diversify and enhance its clients’ long-term investment returns.”

Ashmore is a specialist asset manager focused on Emerging Markets, with 83.6 billion dollars under management (as at 30 June 2020), and has a proven active management approach that has been tailored over more than two decades to deliver investment performance for clients. XP has outstanding distribution capabilities, coupled with educational engagement that guides investors in intelligent diversification that makes sense in the current domestic and international environment.

HSBC Names Annabel Spring as its New CEO of Private Banking

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HSBC has named Annabel Spring as CEO of its recently merged global private banking business, an appointment that takes immediate effect, announced International Investment. Based in London, she will report to Charlie Nunn, CEO of HSBC’s Wealth and Personal Banking (WPB).

Spring joined the corporation in 2019 as group head of customer and products for WPB, where she has been responsible for HSBC’s international personal banking products and its Premier and Jade global services.

Previously, she worked nine years for the Commonwealth Bank of Australia, where her most recent title was group executive for wealth management. Spring also held senior roles at Morgan Stanley, including global head of firm strategy and execution.

HSBC also appointed Taylan Turan as group head of customers, products and strategy for the WPB division. He will remain group head of strategy while also assuming Spring’s former role.

Nunn said that both Spring and Turan will play “an important role” in accelerating the growth of HSBC’s business as they continue to invest in customer offering, technology and products. “As we operate in some of the fastest-growing wealth markets in the world, global private banking, a business with tremendous growth potential, is central to this ambition”, he added.

Santander CIB Launches ESG Solutions Global Team Headed by Steffen Kram

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naturalezadePixabay — Pixabay CC0 Public Domain. Santander CIB launches ESG Solutions global team headed by Steffen Kram

Santander Corporate & Investment Banking (Santander CIB) announced in a press release the creation of a dedicated team to boost its offering in the area of Environmental, Social and Governance (ESG) solutions. This new global team will be headed by Steffen Kram. It will partner with product teams across its platform to support clients in their transition towards a more sustainable business model by providing strategic solutions as well as product and financing structures tailored to specific industries, geographies and market sectors.

Santander’s goal is to build a more responsible bank and has made a number of commitments to support this objective including raising over 120 billion euros in green finance between 2019 and 2025. This figure will increase to 220 billion euros in 2030 and includes the Group´s overall contribution to green finance: project finance, syndicated loans, green bonds, capital and export finance, advisory and other products.

In the most recent Dow Jones Sustainability Index Santander achieved the highest ranking among all banks.

José M. Linares, SEVP and Global Head of Santander CIB, said that the creation of this team further reinforces their contribution to the group’s responsible banking commitments to support inclusive and sustainable growth. “We want to back our clients in their ESG transformation journey, helping them define and achieve their global sustainability objectives”, he added.

Kram, new Global Head of ESG Solutions, commented this new team will build on Santander’s global footprint and its commitment to climate and environmental sustainability. “We are a global leader in renewable energy financing and advisory. Our aim is to expand and transfer this expertise into other sectors and technologies crucial in the context of the energy transition”, he pointed out.

Leveraging on a solid track record in renewables and strong product capabilities across its platform, Santander CIB is now evolving towards fully integrated ESG solutions, serving an increasing appetite and demand from corporate and institutional clients. Being a leader in the area of sustainability has been a long-standing ambition for Santander CIB.

Jean Hynes to Succeed Brendan Swords as CEO of Wellington Management

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Wellington Management has announced in a press release that Brendan Swords, Chief Executive Officer, will retire from Wellington on 30 June 2021. At that time, Jean Hynes, Managing Partner, will succeed him as CEO.

“One of the most enduring lessons of the Wellington partnership is the notion of stewardship, bringing along the next generation of leaders to allow us to better serve clients,” said Swords.

“I’m excited that Jean Hynes will be my successor. Over the course of her nearly 30 years at the firm, she has demonstrated the vision, optimism, and fortitude to lead Wellington in the years ahead. Her extensive investment and leadership experience align with our mission of delivering investment excellence to our clients”, he added.

Meanwhile, Hynes claimed to be “humbled and honored” to be the next CEO of Wellington Management. “I have had the privilege of learning alongside Brendan for many years, and I am looking forward to building on our long heritage of helping our clients and their beneficiaries around the world achieve their investment goals”, she said.

Hynes joined the firm in 1991 after graduating from Wellesley College with a BA in economics. Throughout her nearly 30 years at the firm, she has researched the pharmaceutical and biotechnology industries, as well as served as a healthcare portfolio manager and leader of this sector’s research team. Since 2014, she has served as one the firm’s three Managing Partners alongside Swords. Hynes is a member of the Investment Committees at Wellesley College and the Winsor School.

Neuberger Berman and XP Inc. Join Forces to Provide US Multi Cap Strategy to Brazilian Investors

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puzzle-3223941_1280 — Pixabay CC0 Public Domain. Neuberger Berman y XP unen fuerzas para ofrecer una estrategia US multicap a inversores brasileños

Neuberger Berman, a private, independent, employee-owned investment manager, has partnered with XP Inc, a leading technology-driven financial services platform, to offer its flagship US multi-cap equity strategy to Brazilian investors. Via the XP Investments platform, the Neuberger Berman Multi-Cap Opportunities Fund will be available for Brazilian retail and institutional investors through a local feeder fund managed by XP.

The Neuberger Berman Multi-Cap Opportunities Fund is driven by fundamental research to uncover investment opportunities across US equity markets regardless of capitalisation or style spectrums. The fund is a high conviction strategy which typically invests in 30-40 stocks across three distinct categories: Special Situations, Opportunistic and Classic.

The investment team, led by Senior Portfolio Manager Richard Nackenson, adopts a disciplined bottom-up process alongside in-depth quantitative and qualitative free cash flow and capital structure analysis of investee companies. Nackenson, who has run the strategy for over 15 years and has 25 years of investment experience, is supported by a dedicated team of three securities analysts, as well as Neuberger Berman’s wider equity division and ESG investment team. The management team currently runs over 2, 6 billion dollars on behalf of clients globally.

Fabiano Cintra, Funds Specialist at XP Inc, says: “XP’s core mission is to open up a new wave of solutions for Brazilian investors by partnering with the best investment management talent across the world. We are delighted to have established this partnership with Neuberger Berman, which manages over $330 billion globally, and are confident that the US Multi-Cap Opportunities fund’s unconstrained and distinct approach to US equity investing will resonate with our client base.”

Dik van Lomwel, Head of EMEA and Latin America at Neuberger Berman, adds: “This partnership is testament to the Multi-Cap Opportunities Fund’s strong long-term track record and our team’s long-standing, distinct investment philosophy. It marks the latest step in our growth in Latin America and we are pleased to be able to offer this strategy to a wider range of Brazilian investors via the XP platform.”