CC-BY-SA-2.0, FlickrPhoto: Moyan Brenn. The Implications Of Brexit For The Emerging World
In the end, the implications of Brexit are larger for the UK and Europe than for the emerging world. But this does not mean that Brexit does not impact EM.
Firstly, if there is a prolonged risk aversion in global markets, eventually it should affect the weakest links most. Large parts of the emerging world are still suffering from weak growth, the excessive leverage built up in the past years that limits the room for a domestic demand recovery, a high reliance on foreign capital and increased political risk.
Secondly, Brexit has increased the likelihood of an extended period of US dollar strength. This is never good for emerging markets: EM currencies are likely to depreciate and capital outflows should increase. Also, a stronger USD index normally means that the price of oil and other commodities declines. This affects the commodity‐ exporting countries, which in general are the fundamentally weaker economies.
Thirdly, the uncertainty caused by Brexit should lead to an adjustment in growth expectations for the UK and Europe. This hurts central Europe and Asia, for which Europe is the main trading partner. And global trade was already weak. It has recovered a bit in recent months, from ‐3% in January to +2% in April, but we should question the sustainability of this pick‐up now. Also relevant in this context is the weakening of the euro. This does certainly not help the Asian exporters.
And fourthly, with the globalisation trend already struggling in the past few years, Brexit could turn out to be a new negative factor. Trade between the UK and Europe is likely to be affected in the first years after Brexit and more headwinds for global trade could emerge after the US elections. The emerging economies have poor domestic demand growth prospects mainly due to the large debt overhang after many years of excessive credit growth. As a consequence, global trade has become even more important for a possible recovery. Globalisation in reverse would justify an adjustment in longer‐term growth expectations for the emerging world as a whole.
Willem Verhagen is Senior Economist and Maarten-Jan Bakkum is Strategist, Emerging Markets Equity at NN Investment Partners.
CC-BY-SA-2.0, FlickrPhoto: Hubert Figuiere. Three Reasons Not to Boot Your Bonds After Brexit
As the dust settles, and the house of Commons schedules a hearing on September 5th, to discuss the possibility of a second Referendum, AB’s Paul DeNoon, Director—Emerging-Market Debt, Scott DiMaggio, Director—Global Fixed Income and Canada Fixed Income, and Gershon Distenfeld, Director—High Yield and Investment-Grade Credit, offer three reasons you shouldn’t “exit” your bond portfolios.
1.- Calm and Orderly Markets. A crisis? The AB specialists believe they are far from it. Political turmoil in the UK aside, most people are keeping their heads. The markets have in fact been remarkably well behaved. And the further from the center of the storm, the less the disruption. US municipal markets, for example, remained completely unruffled as events unfolded, they explain.
The UK and countries most proximate to it came under the most stress. “Riskier assets, including European high yield, were briefly down in price owing to correlations with equities. Interestingly, however, we saw no forced selling when prices dipped.”
What did they see instead? Buyers. As a result, higher-yielding bonds outside of Europe have held up nicely. Even emerging-market debt weathered the situation well; that’s partly because although oil is down 4.5% in response to Brexit, other commodities such as copper are on the rise.
Already, the capital markets appear to have stabilized, they state.
The three od them believe there are critical reasons why in spite of uncertainty and political drama, the impact has been limited, rather than fueling a contagion or meltdown effect, as in 2008. “The global banking system is in far better condition now than then, thanks to increased regulation, and the derivatives market has been cleaned up as well. Together with central bank policy responses, these give investors confidence in the financial system.”
2.- Credit Loves “Lower, Longer.” How long might this go on? The UK must trigger Article 50 to start the clock on exiting the EU. From then, the exit process will take another two years, though that could be extended. Prime Minister Cameron says he will leave triggering Article 50 to the next prime minister.
“To the extent that Brexit creates economic and financial market uncertainty for an extended period, the Federal Reserve and other central banks distant from the epicenter are likely to remain accommodative for longer. And make no mistake: there will be a central bank policy response around the globe—one that we believe will be enough to offset the growth shock in the UK. But that’s not bad news for investors.” the AB directors state.
“Over the longer run, slower growth and interest rates that remain lower for longer may prove helpful to credit markets outside Europe. While recession is bad for credit markets, so too is rapid growth, which leads to rapid tightening. The sweet spot? Slow growth, which keeps central banks in low-rate territory.”
3.- You Kept Some Powder Dry. DeNoon, DiMaggio y Distenfeld recall that during times of market stress, investors who have kept cash on the sidelines can snap up attractively priced securities before they’re bid higher again.
Over the last few days, opportunities sprang up in commercial mortgage-backed securities and the financials sector. In their opinion, investors who either felt too risk averse to take on new positions during that time, or would have had to sell positions at low prices in order to buy new ones, missed out.
“Savvy global core investors—those who invest in global bonds as a strategic offset to risk assets—also came into Brexit currency-hedged, and will stay that way.” During the flight to safety, currencies close to the center of the storm fared poorly, but the US dollar, yen and Swiss franc did well. As a result, even a UK bond position performed well in portfolios that were hedged into US dollars they point out.
“There’s no question that the global bond markets saw exaggerated price movements following the Brexit referendum, particularly in the UK and the rest of Europe. And we’re continuing to closely monitor the situation. But we’ve not observed stress in the short-term funding markets, forced selling by risk-parity strategies or panicked investor outflows. On the contrary, investors hold core bond or high-income portfolios for specific investment reasons—reasons that still hold true today. As long as bond portfolios maintain adequate liquidity in the face of volatile markets, the Brexit experience shows that it pays to keep bonds on board.” They conclude.
CC-BY-SA-2.0, FlickrPhoto: Juan FernandezG. Ignacio Pedrosa Joins BTG Pactual in Chile
BTG Pactual Chile hired Ignacio Pedrosa, as Executive Director of its Internatonal Funds division.
Pedrosa has had a successful career in Asset Management and Private Banking with over 20 years experience. Prior to joining BTG Pactual he was in charge of the Spanish operations of French Tikehau Investment Management. Before that he served in Spain’s most renowned independent asset managers, Bestinver and EDM and was a member of the Board of the United Investors Sicav Luxembourg. Between 1999 and 2005 he held various positions at Banco Urquijo (Sabadell) including Regional Private Banking Director.
He holds and Economics and Business BA from the San Pablo CEU University in Madrid.
CC-BY-SA-2.0, FlickrRoger Ibbotson set up Zebra Capital in 2001.. Kepler Launches New UCITS Platform with A Global Equity Beta Neutral Fund Advised by Zebra Capital
Kepler Partners LLP has raised $81m via its new UCITS platform, Kepler Liquid Strategies (KLS), for a global equity beta neutral fund. This is the first sub-fund of the KLS ICAV, which is a Dublin domiciled UCITS structure designed to give investors access to high quality managers selected by the team at Kepler Partners.
The fund, KLS Zebra Global Equity Beta Neutral, began trading on June 30th and saw significant interest from investors across Europe, despite the chaos in financial markets around the Brexit referendum.
Kepler has appointed Connecticut based Zebra Capital Management LLC as investment advisor on the fund, who will manage the portfolio based on their established investment process and philosophy. The KLS Zebra Global Equity Beta Neutral fund mirrors a strategy run by Zebra Capital in an existing offshore hedge fund. As a beta neutral strategy, it is designed to avoid the kind of volatility which markets have been experiencing in recent weeks. The new fund targets a net return of 7-8% per annum over a market cycle with a volatility of 5-6% per annum.
The underlying strategy is typically made up of 650 long and 450 short equity positions and uses a unique ‘popularity factor’ developed by the Zebra team which includes former Yale Professor Roger Ibbotson, who set up Zebra Capital in 2001. The core theory revolves around the idea that fundamentally strong but unpopular stocks tend to outperform fundamentally weak but popular companies. Ibbotson was described by the FT this year as the ‘pioneering analyst of the equity risk premium’ and the ‘godfather of smart beta’.
Georg Reutter, head of research at Kepler Partners, said: “Given the current uncertainty in global markets, we feel it is a good moment to be bringing a beta neutral strategy to the market. We are very pleased that our research based approach has led us to partnering with Zebra Capital as the first fund on the KLS platform.”
Laurie Robathan, head of sales, added: “Kepler has raised $1.3bn for UCITS fund clients since 2010 and, after biding our time for some years, it is exciting to have now made the logical step into this space by launching our own dedicated UCITS platform”. “We are very pleased to be working with a group of Zebra’s calibre and their total commitment as a firm to this project has been clear from the outset. Given the turmoil of recent weeks, the success of this launch is a clear signal from the market that this is the right fund at the right time.”
KLS Zebra Global Equity Beta Neutral Fund has an annual fee of 1% and a performance fee of 10%.
CC-BY-SA-2.0, FlickrPhoto: Intv Gene. GAM announces acquisition of Cantab Capital Partners and launches GAM Systematic investment platform
GAM announced the acquisition of Cantab Capital Partners (Cantab), an industry-leading, multi-strategy systematic manager based in Cambridge, UK. Cantab manages USD 4.0 billion in assets for institutional clients worldwide.
Purchase price consists of an upfront cash payment of USD 217 million, funded from GAM’s existing cash resources, and deferred consideration based on future management fee revenues. GAM is the industry’s third-biggest provider of liquid alternative UCITS funds.
At the same time, GAM launches GAM Systematic, a new investment platform dedicated to systematic products and solutions across liquid alternatives and long-only traditional asset classes including equities, debt and multi asset. Cantab will form the cornerstone of GAM Systematic.
By moving into the growing segment of scalable systematic investing, GAM takes an important step to deliver on its long-term objective to expand and diversify its active asset management business. Leading systematic strategies are attracting substantial allocations from investors globally due to their compelling returns and their rigorous, disciplined investment processes.
GAM Systematic will complement GAM’s successful active discretionary investment offering. It will also serve as the Group’s innovation hub for the development of new technologies, investment ideas and approaches for systematic strategies and products.
Alexander S. Friedman, Group Chief Executive Officer of GAM, said: “We have been evaluating how best to enter the systematic space for the past 18 months because we believe it represents an important capability for an active investment firm in the current environment and in the decades to come. GAM Systematic will offer our clients a compelling range of unique products complementary to our strong discretionary product range at a time when the investment industry is challenged to provide cost-efficient, liquid and diversified sources of returns.”
CC-BY-SA-2.0, FlickrPhoto: Michael Baldinger. Michael Baldinger To Leave RobecoSAM, Reto Schwager To Be Appointed CEO Ad Interim
RobecoSAM, the investment specialist focused exclusively on Sustainability Investing (SI), today announced that Michael Baldinger, RobecoSAM CEO since 2011 and Member of the Executive Committee (ExCo) since 2009, has decided to leave the firm. He will join the asset management division of an international bank as Global Head of Sustainable & Impact Investing, and will be based in New York.
Reto Schwager, Head of Private Equity at RobecoSAM and Member of the Company’s ExCo since January 2015, will be appointed CEO ad interim per August 15, 2016, subject to FINMA approval. Michael Baldinger will leave the Company once a smooth handover to the CEO ad interim has been completed. A search process for a permanent replacement of Michael Baldinger has already begun. Both internal and external candidates will be considered.
Michael Baldinger joined RobecoSAM in July 2009 as Global Head of Distribution & Marketing and ExCo Member. In January 2011, he was appointed CEO.
Albert Gnägi, PhD, Chairman of the RobecoSAM Board of Directors: “The Board of Directors regrets Michael Baldinger’s decision and thanks him for his contributions over the last years. Michael Baldinger, his ExCo colleagues, and all the dedicated specialists at RobecoSAM have built the world’s foremost platform for SI, upon which the firm will continue to build and grow. We wish Michael all the best for his personal and professional future.”
Michael Baldinger, departing CEO of RobecoSAM: “I am proud of having built, together with my colleagues, the world’s leading platform for SI. After more than seven years with the firm, it is the right time for me to take the next step in my career. I want to thank everyone at RobecoSAM for their dedication and passion to SI and for having given me the opportunity to lead such a wonderful firm.”
CC-BY-SA-2.0, FlickrPhoto: Dave Humphreys. Assessing Brexit And The Impact On The Recovery In Europe
Over a week has passed since the UK electorate narrowly voted to leave the European Union (EU). The MSCI Europe Index fell 10% in the subsequent two days and then bounced back to recover most of that drawdown. On the currency front, sterling fell 10% when compared to pre-referendum levels.
Interestingly, Investec notes that changes in credit spreads and sovereign bond yields in Europe have remained muted indicating stability in that part of the financial market. But for Ken Hsia, portfolio manager European Equity Fund at the firm, this is quite different from the reaction to concerns of a slowdown in 2011/12.
According to the Investec expert, the UK’s decision to leave the EU has resulted in more short-term uncertainty, there is arguably now an opportunity for dialogue and a re-casting of policy to refresh relationships across Europe on a footing that is more aligned with current thinking about the role and purpose of the EU.
How these discussions evolve should interest those outside the region as some themes have global resonance. With government bond yields largely underpinned, Investec believes the relative attractiveness of equities remains intact, especially when corporate balance sheets are the healthiest they have been for many years. Naturally, the pace of recovery in corporate earnings once again comes into question. However, the firm continues to see good bottom-up investment opportunities within the region as identified by our 4Factor process.
What are the opportunities and risks posed by Brexit for European equities?
It is clear that the prevailing uncertainty will be a drag on economic growth, however, we are seeing some new steers from our 4Factor process. We believe, capital projects with long payback periods will be shelved until there is more certainty. However, we believe, projects with shorter paybacks should not be affected, especially those projects which boost productivity.
In the Investec European Equity Fund, we have reduced exposure to companies that are affected by weakening domestic consumption, but we are happy with our holdings in exporters, as they should see some tailwinds from the weaker sterling.
We are considering further investment in the mining sector, where again the supply/demand dynamic after several years of oversupply is now showing some signs of better balance. We note that European companies in the global energy (Total, BP, Royal Dutch Shell) and mining (BHP Billiton, Rio Tinto) sectors are world-class companies.
How is the Investec European Equity Fund currently positioned to UK equities?
At present, the Investec European Equity Fund is approximately 3% underweight the UK, with a combination of domestic companies (Bovis, BT, National Grid, Just Eat) and some multi-nationals (Shire, BP, Imperial Brands, Paysafe Group). Of these, we believe, Bovis and Just Eat are the most exposed to changes in the UK economy. However, for multi-national companies the UK is typically less than 10% of revenue. The portfolio’s greatest overweights by country are France and the Netherlands.
As well as the direct impact from revenue exposure there may be further effects, but many of these will take some time to come to fruition. For issues such as regulatory change, tourism or trade negotiations, it is too early to assess the impact. In aggregate though, we expect performance to be driven by individual stock price moves rather than portfolio positioning. The beta of the portfolio is 0.98, with market risk therefore a minimal component of tracking error.
Brexit aside, where are we seeing signs of recovery in Europe?
To answer this question, we need to take a closer look at the current state of economic recovery in Europe. Speci cally, we will look at two cyclical (economically-sensitive) industries which have been leading indicators on our sector steers, the automotive industry and the cement industry, to re ect on current demand trends and reasons for the sluggish pace of recovery.
What are the risks to our investment case on European equities?
Though the near term may be dominated by mixed headlines, stock markets normally embed a longer-term perspective. We continue to see a recovery in European corporate earnings, albeit the pace can be frustrating. Also, we observe more companies adopting self-help strategies to enhance corporate returns which, if successful, could lead to enhanced shareholder returns. Corporate balance sheets are the healthiest they have been since before the global financial crisis. In this regard, the potential value created through any re-leveraging – for example; M&A activity and share buybacks – has yet to be realised for Europe, which is not necessarily the case for the US.
Dividends are growing due to improving cash flow and strengthening balance sheets, which have not seen the re-leveraging that often occurs at the end of stock-market cycles. To put things into perspective, the historical price chart for the Eurostoxx 50 Index below (covering 50 ‘blue chip’ stocks from 12 euro-zone countries) suggests the market is trading back in line with long-term trends. Analysis shows recent cycle troughs in 2009, 2011 and 2012, when headlines had a notable impact on market dynamics.
CC-BY-SA-2.0, FlickrPhoto: Rob Brewer. Brexit: Outlook for Global Fixed Income & Credit
Following the initial shock of the Brexit, the critical issues for markets will now be the path that the UK will choose for exit and how the vote will affect the political backdrop in other European countries. We expect to see a continued ‘flight to quality’ in the fixed income market while uncertainty prevails. Risk premiums will likely remain high while the uncertainty of leadership in the UK remains an overhang. In the shorter term, emerging market debt seems relatively insulated; however, there are concerns over the potential for longer term problems. Global credit markets have reacted negatively, as might be expected, but this may provide investors with attractive buying opportunities.
UK growth likely to weaken, with interest rate cuts expected
In terms of the UK economy, until there is confidence in the UK’s position, there will be a drag on business confidence. This will see business investment and employment slow, which will inevitably be a drag on UK growth. As a result, we expect economic data in the UK to weaken in coming quarters. The Bank of England could react to this by reducing interest rates from 0.50% to possibly as low as 0%, but it will likely need some concrete evidence that the economy is being negatively affected before acting.
Most forecasters are still in the process of reassessing their outlooks, but Bank of America now expects the UK to have a mild contraction lasting three quarters, reducing its forecasts for UK growth to 1.4% in 2016 and 0.2% in 2017. Inflation will be affected by the move in British pound sterling, but further falls would be needed to increase inflation to a level where the Bank of England would potentially worry given the very low current levels.
Flight to quality in developed fixed income markets
We expect the uncertainty premium to persist for some time as the exit process will be negotiated over an indeterminate period. Overall, we have observed an initial flight to quality, with Gilts leading the bond market on an over 30 basis point (bp) rally in yields, while US Treasuries were a close second, rallying over 20 bps on the day after the vote. Gilts have continued to rally despite the indication that S&P will likely downgrade the UK’s credit rating. The European periphery was the hardest hit on the news, with Spanish and Italian government bonds selling off more than 15 bps.
A July rate hike for the US Federal Reserve (Fed) now seems very unlikely, with market implied expectations of a rate cut now exceeding the probability of a rise. The Bank of England will likely remain on the sidelines until the dust settles, but remains in play with increased market implied expectations for a rate cut within the next several meetings.
In currency markets, the British pound fell over 7% as of mid-day trading on June 24, and is off more than 3% mid-day on June 25, while the broader foreign exchange (FX) market sold off versus the US dollar. The Yen remained the top performer on the day, up over 3.5%.
Emerging market debt relatively insulated
The impact on external debt has been limited so far. Spreads are 30 bps wider but US Treasuries are 20 bps tighter and overall the JP Morgan Emerging Markets Bond Global Diversified Index lost only 0.6% on 24 June. Local rates were 10 bps tighter in Asia and 10 to 20 bps wider in Latin America and Central & Eastern Europe, the Middle East and Africa (CEEMEA).
Most of the initial risk aversion shock was felt in the FX market and EM currencies are on average 2.75% weaker versus the US dollar.
Overall, as an asset class, emerging market debt has been relatively insulated from the initial Brexit surprise. However, in the long term, Brexit could have an impact on EM fundamentals through other channels, particularly for central and eastern European countries. Indeed, the UK is a significant trading partner and foreign direct investor in the region. Romania is the most exposed when we consider exports to the UK, while Russia, Poland, Czech Republic and Romania are exposed in terms of imports from the UK.
Beyond trade and financial considerations, we can also envision a rise of political risk in the region. Poland and Slovakia are already openly criticising the EU and the anti-EU rhetoric is likely to increase further. The Euro adoption process will likely be stalled as well. Ultimately, increased political risk may further delay the absorption of EU funds and Poland, Hungary and Romania are the biggest net beneficiaries from the EU budget.
Global credit has reacted negatively, but could provide opportunities for investors
Credit markets reacted negatively to the UK’s decision to leave the EU. It started with Asian credit, but European markets soon followed suit, with credit default swaps (CDS) as well as cash and bonds trading down. Sterling credit issuers were most affected, while price effects for Euro credit were more muted, given the ECB’s bond buying programme. The basic resource sector and banks suffered heavily. We expect trading in US credit to take its lead from European markets. In our view, the correction in valuations and market volatility could provide buying opportunities in some fundamentally strong credits.
Andre Severino is Co-Head of Global Fixed Income at Nikko AM.
. Commerzbank International in Luxembourg Becomes Julius Baer
The acquisition of Commerzbank International Luxembourg, announced in December 2015, was closed successfully on July 4th, 2016. Going forward, the acquired entity will operate under the name of Bank Julius Baer Luxembourg. The acquisition significantly strengthens Julius Baer’s presence in Luxembourg and provides further strategic flexibility for the Group’s European business.
At closing, CISAL reported approx. EUR 2.5 billion of assets under management and about 150 employees. Going forward, CISAL will operate under the name of Bank Julius Baer Luxembourg S.A., headed by CISAL’s former CEO Falk Fischer. Thomas Fehr, former Branch & Country Manager Luxembourg at Commerzbank AG, becomes COO and Member of the Executive Board of the Bank in Luxembourg.
The total consideration of EUR 78 million, which includes EUR 35 million of regulatory capital transferred as part of the transaction, was paid in cash. Total restructuring and integration costs are estimated to amount to approximately EUR 20 million.
According to a press release, an additional benefit of the transaction is CISAL’s banking platform which runs on the same system as Julius Baer’s target platform. “The acquired Temenos T24 platform and the related IT expertise will add relevant experience to Julius Baer’s currently ongoing worldwide platform renewal project. At the same time, the newly acquired booking centre will present Julius Baer with further strategic flexibility for servicing its European clients.”
Gian A. Rossi, Member of the Executive Board of Bank Julius Baer and Head Northern, Central and Eastern Europe, said: “I very much look forward to welcoming the new clients and colleagues to Julius Baer. CISAL is a high-quality franchise, which will enable us to further expand our footprint in this important financial centre. Additionally, the Luxembourg banking licence and CISAL’s T24 platform and expertise offer clear benefits for the Group as a whole.”
Falk Fischer, said: “My colleagues and I are excited to join Julius Baer. Thanks to the Group’s position as the leading Swiss private bank with a global reach and the great cooperation with the colleagues of the existing local franchise in Luxembourg, I am convinced that our clients will benefit from the unique investment knowledge, exceptional client focus and the enhanced offering the combined businesses will be able to provide.”
CC-BY-SA-2.0, FlickrFoto: Carlos ZGZ. Will China's Debt Bubble Burst?
China is the second-largest economy in the world, with growth more than twice most others, facilitated by its willingness to lever up while others were deleveraging. Last year, China abruptly pulled back its credit-fueled growth, inadvertently slowing its economy far more than desired. The resulting ripples inexplicably weakened economies everywhere. From fall 2015 until March 2016, China reversed course and revived its lending growth to get back into its comfort zone. Can it be sustained?
China’s all-inclusive debt/GDP has now risen tremendously to 250%, equal to that of the US. No warning flag there, yet its interest rates are far higher so its debt service is also higher and rising. Most others have lower and falling debt service ratios. China’s is now at a level where some countries, but not all, have run into sustainability issues. Those who did had large foreign ownership of their debt; foreign investors can be fickle. China’s foreign ownership is tiny. Outside of China, market participants are worried about the quality of China’s outstanding debt, which has overwhelmingly taken the form of bank loans instead of bonds. Nonperforming loans and the number of bond defaults are both rising. While China’s borrowing probably hasn’t gone too far yet, we believe a restructuring lies ahead to keep it that way.
Policy will push a terming-out of loans into bonds, in our view. Extending duration will lower debt service, resulting in a much larger debt market and smaller loan market. When your interest rates are higher than the rest of the world’s, and policy actions connect your bond market to the outside, your interest rates are prone to coming down. The mutual recognition of Hong Kong and Shanghai registered funds will enable such connectivity. For those who can get comfortable with the yuan’s stability versus a basket of currencies, in today’s yield-starved world, inflows into China’s bond market should lower its rates as well as its debt service. If China’s bond indices become recognized in global indices (a current lobbying effort), this too will help connect its bond market. State-owned enterprises will also be encouraged to issue equity in Hong Kong and bring back those funds to pay down debt. The country cannot maintain rapid debt growth forever – but it can for several more years.
One also needs to consider whether debt is being incurred for consumption or to enable investments: If you generate a return on those investments above the cost of debt, your debt is inherently more sustainable than consumption-driven debt binges. Today, China is trying to bridge its old economy to carry enough growth until its newer economy becomes large enough to pick up the baton. We think the new consumer, services, and higher-technology industries will be strong enough three to five years down the road to do just that. In our eyes, China is building a bridge to a pier, not a bridge to a cliff.
Michael J. Kelly, is Managing Director, Global Head of Multi-Asset at PineBridge Investments.
This information is for educational purposes only and is not intended to serve as investment advice. This is not an offer to sell or solicitation of an offer to purchase any investment product or security. Any opinions provided should not be relied upon for investment decisions. Any opinions, projections, forecasts and forward-looking statements are speculative in nature; valid only as of the date hereof and are subject to change. PineBridge Investments is not soliciting or recommending any action based on this information.
