Nuveen Investments, a global provider of investment services to institutions as well as individual investors, announced the introduction of two new mutual funds managed by its dividend-focused growth equities manager, Santa Barbara Asset Management. The Nuveen Santa Barbara Global Dividend Growth Fund (NUGAX) and Nuveen Santa Barbara International Dividend Growth Fund (NUIAX) are managed by Santa Barbara Chief Investment Officer, James Boothe.
Drawing upon the investment process behind its flagship Nuveen Santa Barbara’s Dividend Growth Fund (NSBAX), the two new funds seek out companies across the world that pay quality dividends and have the ability to grow and maintain their dividend on a long-term basis, thus offering investors a compelling core portfolio holding. The funds are available through advisors at leading broker-dealers, banks, insurance companies, financial planning and investment consulting firms.
The Nuveen Santa Barbara Global Dividend Growth Fund focuses on global equity securities of companies that have potential for dividend income and dividend growth in an effort to provide an attractive total return comprised of dividends and long-term capital appreciation. The Nuveen Santa Barbara International Dividend Growth Fund focuses on international equities that offer current dividend income and have the potential for future dividend growth in an effort to provide an attractive total return comprised of both dividends and long-term capital appreciation.
Wikimedia CommonsPatrick Sumner y Guy Barnard, Portfolio Managers del fondo Henderson Global Property Equities Fund. Henderson espera una recuperación del valor de los bienes raíces pareja a la demanda del mercado de alquiler
In February listed real estate stocks tracked wider markets, with the strongest performance once again coming from Asia, despite further policy tightening measures in Hong Kong. European stocks were weakest in US$ terms as a result of currency weakness. Overall, the FTSE EPRA/NAREIT Developed Index gained 0.72% in US dollar terms. This is the benchmark for the Henderson Horizon Global Property Equities Fund, which performed broadly in line with the index. Their overweight allocation to Asia-Pacific added value, as did the underweight position in Europe.
“We remained active in Asia, adding to positions in Japan in light of our incrementally constructive macro view of the region. Purchases were funded from sales in Australia and Singapore as well as China, where we took profits given policy fears”, explained Guy Barnard and Patrick Summer, co-portfolio managers of the fund in a communication to clients. “In North America we added Wynn Resorts in the hotel space, selling RLJ Lodging. The trade was based on relative value and our expectation of better growth at the higher end of the hotel market than at the limited service price point.”
Global economy is in the doldrums and consensus forecasts point to sub-par growth in 2013. According to the investor team who runs the Henderson Global Property Equities Fund it is hard to predict how politicians will balance the conflicting demands of bond markets and citizens. However, none of this is new news. “Whatever uncertainties exist, it may be fair to say that they are ‘in the price’ and risk appetite is increasing, although sovereign bond yields remain at record lows. Against this backdrop, the income return on property looks relatively attractive and has the important advantage of being a real asset and a reasonable inflation hedge”, they add. In this context, the portfolio managers expect average property values to recover in line with tenant demand, given the general lack of new development. “However, in a weak economy there will be a big difference between the best and the rest. Equity market volatility is likely to persist over the coming months but with a high dividend yield and access to capital markets the companies in which we invest remain well placed”, they conclude.
Foto cedidaFoto: Ronald Doeswijk. Robeco positive on U.S. equities and emerging market debt
“On balance, we expect ongoing growth around the globe, but at a disappointing rate,” is the way that Robeco Chief Strategist Ronald Doeswijk sums up the global macroeconomic picture at the moment.
There have certainly been some encouraging developments recently. Take the US. The rise in the purchasing managers’ index for manufacturers in February confirmed that the underlying momentum in the economy is picking up.
“Signs of continuing improvement convince us that the recovery will remain on track”
Japan’s politicians are getting their act together In Japan, meanwhile, politicians are operating more vigorously to crank up the country’s sclerotic economy. One example of this move up through the gears is the nomination of the dovish Haruhiko Kuroda as the new governor of the Bank of Japan, a step that takes Japan closer to more aggressive monetary easing. At the same time, the latest data on the Japanese recovery has been encouraging; industrial production rose by 1.0% in January.
Even the eurozone economy is showing signs of stabilization, as evidenced by net deposit inflows in Spain. And monetary policy around the globe is set to remain loose.
So far, so good. But there have also been some less positive developments, which are responsible for the cautious note in Doeswijk’s summing up.
US sequestration worries should fade In the US, sequestration—automatic federal spending cuts worth USD 85 billion over the next six months—kicked in on March 1. This has the potential to suppress US economic activity in the coming months.
But Doeswijk doesn’t see this as too big a worry, as a deal will probably be forged at some stage.
“We expect this ripple to fade rather than becoming a threat to the recovery”
The severity of Italy’s situation is being underestimated The other main concern is the heightened political risk in the eurozone after the unexpected stalemate in February’s Italian elections. “The strong performance of anti-austerity factions could destabilize the eurozone and undermine growth,” cautions Doeswijk.
Markets have reacted relatively calmly to Italy’s political developments, apparently comforted by the ECB’s backstop, the OMT. But there is a catch: an ECB activation of the OMT would have to be preceded by the introduction of a reform program in Italy agreed with the EU and the IMF that would be monitored by the troika.
It is fair to say that in the current political environment, the introduction of a comprehensive reform/austerity program looks pretty unlikely. The credibility of the conditionality of the OMT program demanded by the ECB could thus be tested.
Doeswijk thinks the situation could easily deteriorate. “Markets are probably too complacent about the Italian situation,” he warns. “A flare-up of the European debt crisis in the coming months is a serious possibility.”
Positive on equities So how does this moderately improving macro picture feed through into asset-allocation positioning? Doeswijk and his Financial Markets Research team colleagues are relatively upbeat on equities.
“We believe stock prices will trend higher”
For sure, there are risks to this picture. First, increased tensions within the eurozone after the Italian election could turn sentiment negative. Second, it could transpire that the conditionality of the ECB’s support really is conditional.
But Doeswijk feels that more positive forces will prevail. “We maintain our view that quantitative easing and low interest rates are the dominant forces at work for the time being,” he says.
North America is the preferred region in equities Within equities, North America is the team’s favorite region. This is largely down to the macro picture, in particular the self-reinforcing economic recovery in the US. “Given the fiscal headwinds, we expect monetary easing to continue for the foreseeable future, while producer confidence, the housing market and the labor market are all pointing to ongoing growth,” says Doeswijk.
“Government bonds are the least attractive asset category”
Emerging markets are neutral. Economic data there has tended to disappoint, a period of relatively good earnings revisions appears to be over and momentum is disappointing. “The region’s good medium- to long-term prospects are unlikely to play a major role in short-term performance,” cautions Doeswijk.
Prospects for Pacific equities have improved The outlook for the Pacific has brightened, thanks to the efforts of Japan’s prime minister to drive forward aggressive monetary easing, economic reform and fiscal stimulus. Moreover, the weakening yen should boost Japanese exports. The team has a neutral stance on the region for now. “We want to see proof that this policy change will benefit Japan,” he says.
As for Europe, the team maintains its “somewhat negative” view, thanks to the risk of ongoing economic disappointments due to austerity and uncertainty among producers and consumers. “Earnings revisions continue to lag the market,” adds Doeswijk.
High yield and emerging markets favored The Financial Markets Research team continues to like the prospects for corporate bonds. Why so? “Moderate economic growth is the best possible macroeconomic environment for corporate bonds,” says Doeswijk. That is because it results in low default rates and prevents a wave of aggressive takeovers or leveraged buy-outs.
And while both investment-grade credits and high yield bonds are attractive relative to cash or government bonds, they do have a clear preference for high yield. “Our preference is mostly based on the higher running yield, which still leaves room for attractive absolute returns,” explains Doeswijk.
The team also likes emerging markets debt. The asset category is experiencing solid net inflows, which highlights the popularity of emerging debt as the search for yield continues.
Negative on government bonds Doeswijk and colleagues thus favor all three types of bonds to developed-market government bonds. “Although we are not forecasting a significant rise in bond yields, we rank government bonds as the least attractive asset category,” says Doeswijk. “The current low yields are not offering the opportunity for decent returns.”
Real estate prospects attractive despite valuation The outlook for real estate remains good: the team ranks its prospects in line with those of equities. After a disappointing January, real estate was the best-performing asset class in February. Ten-year bond yields have fallen a little, while other positive factors remain in play. But there is one worry that holds Doeswijk back from positioning real estate above equities: valuation relative to equities is unattractive.
Neutral on commodities On commodities, the team has a neutral stance. “Oil price fundamentals point to an oil market that is balanced,” says Doeswijk. On the supply side, lower OPEC production is being offset by record US output. And increased demand from the strengthening US and Chinese economies will probably more than compensate for the falling demand from Europe.
Although gold prices have dipped recently, Doeswijk says it is too early to call the start of a bear market. The close relationship between the price of gold and the expansion of the Fed’s balance sheet has fractured recently, thanks to more bearish Fed minutes that hinted at a cessation of that enlargement. But Ben Bernanke’s more recent indications that the US central bank will continue to pump up its balance sheet suggest a negative call on gold would be premature.
Wikimedia CommonsDan Norman, Managing Director & Group Head of ING U.S. Investment Management’s Senior Loan Group. Senior Bank Loans set to offer good returns in high yield income space in 2013
Dan Norman, Managing Director & Group Head of ING U.S. Investment Management’s Senior Loan Group, said: “We predict the global hunt for yield will not abate any time soon. In 2013, the senior loan market is likely to be a coupon plus “a little” year. Loan prices are expected to remain firm, and we will be patiently waiting for a shift in monetary policy that will eventually encourage rates to rise.”
ING IM states that, in terms of total return expectations for the year, it agrees with the consensus of Wall Street analysts. Therefore, its target total return range for the loan asset class for 2013 is between 5.5% and 6.0%. The investment manager believes that this outlook builds on the successful 2012 enjoyed by the senior loan asset class.
Dan Norman continues: “Overall, 2012 emerged as a favourable year for the global senior loan market. The year started and ended strongly with a few speed bumps along the way. The US fiscal cliff, European indecision, and geopolitical unrest in the Middle East were just a few hurdles 2012 seemed to gracefully push further down the track.
With healthy demand from both new CLO issuance and loan mutual fund inflows, and a strong institutional new issue pipeline that remained robust through the end, 2012’s technical strength is apparent and looks to carry into the beginning of 2013.”
ING IM highlights that, supported by the reappearance of CLO issuance, the S&P/LSTA Leveraged Loan Index was up 9.64% for 2012 with an average bid of 96.79 ticked up 518 bps as of December 31, 2012.
Furthermore, last year saw a total of 69 CLO managers launch 116 new vehicles with the latter totalling $53.5 billion, which is double the amount of $27.9 billion issued in the past four years combined. The new found CLO demand for bank loans was added to roughly $8 billion of inflow to bank loan mutual funds, up from $6.3 billion in 2011. The investment manager notes that approximately 16% of the total inflow was a result of ETF inflows.
Dan Norman concludes:“Looking ahead to 2013, the default outlook is increasingly favourable, as the 2013 maturity wall standing at a whopping $28 billion last year has been reduced to a measly $4.7 billion. Estimates for 2013 default rates hover around 2.04% which, although higher than last year, is still well below the long term average of 3.3%.”
Wikimedia CommonsFoto: Böhringer Friedrich. How to preserve the family wealth?
There are a little more than 100,000 families in the United States that have a net worth in excess of $25 million. A majority of these families have built this wealth through the ownership, growth and sale of mid-market businesses. Unfortunately research indicates that for 98% of these families, their great grandchildren will not see any of this wealth – it will be gone. This is primarily attributed to poor communication, a lack of trust among family members and unprepared heirs.
According to Divestopedia, a resource for entrepreneurs who want to sell their business for the best price and terms,here are four ways you can begin to thwart these issues and preserve your family wealth:
1. Host Family Gatherings: If you have three or four generations in your family and don’t already invite them to spend vacation time together, this is a great first step in building family identity and creating lasting memories.
2. Family Philanthropy: One of the easiest ways to implement a family giving program is to provide each of your family members with their own donor advised fund (DAF). In simple terms, you make a donation to the DAF (and receive the benefit of the tax deduction), but your family gets to decide which organizations will receive donations. This is both simple and convenient.
3. Creating a Family Bank: Although this may sound formal and fancy, implementing a family bank structure can be quite simple to start. Ideally, everyone in the family will come to recognize that your wealth can be utilized to support and reward positive behaviour. The family bank would commonly fund education expenses, business ventures or opportunities to support family member goals.
The main distinction between gifting and family banking is accountability. Generally there is some type of application process and a review process. It is recommended to involve outside advisors in the decision making process
4. Investment Committee: By forming an investment committee, knowledge can be shared and transferred between generations in a supportive environment. More importantly, family members with deep knowledge within a specific arena can apply their skills to benefit the entire family. To form an investment committee requires two things – a pool of money or assets to be managed, and a group of people willing to take on the responsibility. The matriarch and/or patriarch do not participate on the initial investment committee. Instead, one member of each branch of the family is asked to participate. The family CFO/financial advisor and/or outside Chief Investment Officer/money manager should facilitate the meetings and design the agenda until a family member wants to take over.
Global fund transaction network Calastone has launched its new Swiss office in Zurich, in a bid to boost its presence and capabilities as an enabler of domestic and cross border funds STP.
Calastone has 10 clients in Switzerland and hopes its new office in Zurich will help to develop more business in the country, as well as being a way to support existing Swiss clients. The new office will primarily provide sales and account management support, with day-to-day operational support managed from the UK.
Vittorio Pujatti has been named to the management team, and will join as director of Swiss Sales & Business Development in a move to explore and develop business opportunities in the Swiss market.
Having over 25 years in high-level sales and managerial experience in the Swiss and International securities firms, and financial investments houses, Pujatti has also worked with UBS Investment Bank in Zurich as head of US-Equity Proprietary team and as managing director/branch manager at Instinet Schweiz, among others.
Wikimedia CommonsFoto: By OiMax. El broker dealer Mizuho Securities contrata un equipo de deuda latinoamericana
Mizuho Securities USA the U.S. broker-dealer subsidiary of the global Mizuho Financial Group, announced the addition of senior emerging markets fixed income sales and trading appointments to build out the firm’s investment grade and sub investment grade coverage for Latin America debt.
Trading hires include Allan Grauer, Head of LatAm Trading, Sebastian Azumendi, Head of LatAm Credit Trading; and Georges Fernandes, High Yield Credit Trading. Emerging Markets Fixed Income Sales will be enhanced with the additions of Rod Eichler and Nestor Cybriwsky. Further appointments to the team are expected.
Jerry Rizzieri, Executive Managing Director and Head of Fixed Income, MSUSA, commented, “Diversifying our product lines to better service customers continues to be a high priority for Mizuho Securities USA. Latin American debt trading is a natural extension of our fixed income platform’s existing Investment Grade and High Yield Credit businesses and aligns with Mizuho’s expansion efforts in Brazil.”
Mizuho’s presence in Latin America will also continue to grow with the completed acquisition of Banco West LB do Brasil. Although still subject to regulatory approval, the acquisition of a Brazilian corporate banking subsidiary will significantly enhance Mizuho’s ability to support client business activities in Brazil and across the region through more extensive financing and advisory services for potential acquisitions, divestitures or joint ventures, and greater access to loans, derivatives and other capital markets products.
Foto: Annick MONNIER . Los fondos con valores menos líquidos superan a su competencia
Morningstar has announced that the CFA Institute Financial Analysts Journal (FAJ) has selected “The Liquidity Style of Mutual Funds” by Thomas Idzorek, James Xiong, and Roger Ibbotson for a prestigious Graham & Dodd Scroll Award for 2012. Idzorek, CFA, is president of the Morningstar Investment Management division; Xiong, Ph.D., CFA, is a senior research consultant in the Morningstar Investment Management division; and Ibbotson, Ph.D., CFA, is founder of Ibbotson Associates, chairman and chief investment officer of Zebra Capital Management, and professor of finance at the Yale School of Management. Morningstar acquired Ibbotson Associates in 2006. This is the 10th award from the FAJ won for financial writing based on research of Morningstar, Inc. or its subsidiaries.
“Liquidity offers another valuable lens to help investors evaluate and select mutual funds”
Recent studies have shown that a liquidity investment style—investing in stocks with lower trading volume—has led to excess returns. In “The Liquidity Style of Mutual Funds,” the authors examined whether this style premium, previously documented in stock investing, can be applied at the mutual fund level. Across a wide range of mutual fund categories, they found that, on average, mutual funds that held less-liquid stocks significantly outperformed those that held more-liquid stocks. The paper was published in the November/December 2012 edition of the FAJ and can be found at www.cfapubs.org.
“There are many lenses through which we can view investments—large capitalization versus small, growth versus value. Liquidity offers another valuable lens to help investors evaluate and select mutual funds,” Joe Mansueto, chairman and chief executive officer of Morningstar, said. “For years, Tom, James, and Roger have been producing innovative research on manager selection, asset allocation, and portfolio construction with an emphasis on theories and techniques that can be put into practice. We’re pleased that the FAJ recognized these thought leaders and their contribution to the field.”
Wikimedia CommonsFoto: böhringer friedrich. New collaboration between RobecoSAM and CDP will streamline corporate sustainability reporting to inform investor rankings
As part of its annual corporate sustainability ranking process, RobecoSAM, the company behind the Dow Jones Sustainability Indices (DJSI), produced with S&P Dow Jones Indices, will now ask public companies the same climate change questions as those developed over the past decade by CDP (Carbon Disclosure Project), provider of the only global environmental disclosure system and producer of the annual Climate Disclosure and Climate Performance Leadership Indexes (CDLI & CPLI). This collaboration will improve the comparability of sustainability data in the global market and will simplify the process for companies answering multiple requests for environmental information.
Specifically, to inform the climate change aspects of its annual Corporate Sustainability Assessment, RobecoSAM has aligned seven of its Climate Strategy questions with corresponding questions asked by CDP on behalf of 722 investors representing more than US$87 trillion. This will significantly reduce the workload for the 90% of DJSI participating companies which also respond to the request for climate change information through CDP.
CDP’s chief executive officer Paul Simpson says: “This is an important response to market demand. Both the business and investment communities have called for a more harmonized approach to sustainability reporting and for more comparable data. It will now be easier to incorporate climate risk, opportunity and governance into evaluations of corporate progress on sustainability. CDP and RobecoSAM are the de facto raters for business progress on climate change and sustainability and this development will bring high quality data together for use in the DJSI.”
Daniel Wild, head of research at RobecoSAM states: “We are natural partners given our mutual focus on sustainability issues that are financially material for investors who are focused on identifying innovative companies that are well-positioned for the long-term. In aligning our environmental data collection approaches we hope to lessen the burden on companies that currently have to submit similar data to both CDP and RobecoSAM.”
Further, to promote greater uptake and use of environmental disclosure, CDP and RobecoSAM are investigating additional areas of corporate environmental assessment to cooperate on and will leverage their networks to encourage more companies to complete both questionnaires. More than 4,100 companies use CDP to report their climate change strategies and impacts to investors and the disclosure rate among the world’s largest companies runs at 80%. RobecoSAM assesses the corporate sustainability of over 2,000 listed companies summing up to 60% of the world total market capitalization on a wide range of criteria.
Wikimedia CommonsPhoto: Petr Novák, Wikipedia. Risk Tolerance by Generation
No doubt attributable, at least in part, to the recent market recovery, investors risk tolerance appears to be increasing.
Gen Y, the youngest investors appear to be more conservative in their approach than their Gen X peers. In fact, the risk allocation of Gen Y investors largely mirrors that of Gen Xers in 2011. This caution among twenty-somethings is understandable, considering that the bulk of their limited investing experience has occurred since the 2008 market meltdown.
Gen X investorshave shifted their asset allocation to accept more risk and increase their return potential in 2012.
Boomers and investors in the Silent Generationreport a more risk-averse profile overall. However, each cohort has shifted a significant portion of their assets from low-risk to moderate-risk investments over the past year — a welcome sign for advisors and investment providers alike, who may benefit from money moving off the sidelines.
This information was taken from the Cogent Research Investor Brandscape® report, which is based on a representative survey of over 4,000 affluent investors within the United States. It is the leading industry benchmark for brand preference and product usage among affluent investors and has been tracking the attitudes and behaviors of affluent investors since 2006.