GAM will struggle to shake off virus malaise 4 Aug 2020 The Swiss fund manager reported a net loss and its assets under management fell to $130 bln in the first half. CEO Peter Sanderson is cutting costs, but his medium-term targets look fanciful. His company is badly positioned to cope with the tough environment facing the industry.
Credit Suisse takes right leaf out of rival’s book 30 Jul 2020 CEO Thomas Gottstein will cut costs and deploy more capital in wealth management. A slimmer investment bank would make the lender look more like UBS, which has a higher valuation. To close that gap faster, the new boss could hand savings to investors instead of reinvesting them.
The Exchange: Brave new credit world 21 Jul 2020 The crisis unearthed land mines in the fixed-income market – many of which Arena Investors Chief Executive Dan Zwirn had previously identified. He now explains how to navigate this opaque universe with deep dives on leveraged finance, liquidity crunches and an activist Fed.
Review: Market twists and turns, unraveled 17 Jul 2020 In a new book, “The Long Good Buy,” Goldman Sachs’ top equity strategist breaks down investment cycles and offers much needed historical perspective. It helps make sense of today’s head-scratching market and the asset total gyrations at the likes of giant fund manager BlackRock.
Green laggards face a rising tide of short selling 15 Jul 2020 A new BNP Paribas fund will hedge investments in companies embracing the energy transition by betting against shares in refuseniks. Shorting ESG sinners isn’t easy, and has even caused controversy. But as disclosure improves it can play a growing role in sorting sheep from goats.
BlackRock warrants a spot on its climate watchlist 14 Jul 2020 The $6.5 trln asset manager voted against 53 companies for environmental missteps in the past 12 months and put 191 more on notice. It’s much better than the previous year, and necessary after CEO Larry Fink’s call to climate arms. But BlackRock’s own role needs monitoring too.
Norilsk Nickel underlines funds’ ESG blind spot 2 Jul 2020 The Russian miner had a bad pollution record even before it leaked 21,000 tonnes of fuel in the Arctic Circle. Passive investors like BlackRock have pledged to engage more closely with ESG miscreants. But when the company is controlled by oligarchs, they may just be ignored.
New Standard Life boss may give dividend the bird 30 Jun 2020 Keith Skeoch is leaving the $7 bln fund group shortly after his co-CEO Martin Gilbert. With both architects of the Standard Life Aberdeen merger gone, successor Stephen Bird faces a lengthy turnaround, made harder by Covid-19. A fat payout looks like an unaffordable luxury.
Corona Capital: UK debt, Oaktree, KKR, Chanel 19 Jun 2020 Concise views on the pandemic’s corporate and financial fallout: UK government borrowing surges past GDP; Howard Marks is sceptical about the stock market revival; KKR bets on cheap and local European holidays; Chanel takes a gloomier view than rivals on the luxury rebound.
The Exchange: Bruce Flatt 16 Jun 2020 The office is not dead, though hot-desking may be. The elevator needs a rethink. And don’t rule out the shopping mall. Brookfield Asset Management’s chief executive made these and other predictions for the post-pandemic global economy in a recent chat with Breakingviews editors.
Buyout fund investors score some leverage on fees 15 Jun 2020 Private equity pools raised between 2006 and 2015 performed no better than public stocks, an Oxford University study found. Pension funds and other backers probably won’t abandon groups like Blackstone and KKR. Yet proof of shrinking returns helps make the case for lower costs.
The Exchange: BlackRock ETFs 9 Jun 2020 Exchange-traded funds are wildly popular with retail and institutional investors alike. BlackRock’s global head of ETFs and index investments Salim Ramji demystifies these tools, revealing how they passed their crisis test and how they challenge the active vs. passive divide.
BlackRock is becoming the new, old Goldman Sachs 4 Jun 2020 Before and during the financial crisis, Goldman seemed to have a finger in every pie. Now it’s as if Larry Fink’s asset manager, wielding $7 trillion of investor cash, is slipping into that role. For all BlackRock's efforts, brickbats and more regulation could follow.
Private equity hangers-on face diminishing returns 3 Jun 2020 France’s Ardian raised $19 bln to buy stakes in other buyout funds. The niche, known as secondary investing, did well after the last crisis and is booming as conventional fundraising slows. Yet sellers are less desperate this time, and an oversupply of capital may hurt returns.
Stock-pickers will join endangered species list 27 May 2020 Active fund managers failed to outperform as the pandemic struck. A Covid-19 legacy of corporate disruption and central bank support will make gaining an edge even harder. As the shift towards passive investments accelerates, fees will be compressed and mergers may be necessary.
Corona Capital: Natural gas, Disney, Brazil 19 May 2020 Concise views on the pandemic’s corporate and financial fallout: Investors are too optimistic about natural gas; theme-park veterans take key roles at Disney; and Sao Paulo’s idea of bringing forward holidays to improve social distancing proves confusing.
Sustainable investing’s virus halo is premature 18 May 2020 Environmental, social and governance-focused funds outperformed peers in the first quarter, new BlackRock research suggests. Steady inflows are encouraging given the fear investors would ditch ESG in a crisis. But one quarter alone is not enough to judge the sector.
New normal will demand new gold-standard portfolio 6 May 2020 Parking 60% in equities and 40% in fixed income is the traditional balanced approach. That’s off kilter if bonds are going to offer less and less income and are sometimes almost as volatile as shares. The solution may be to hold more stocks and cash, and possibly gold, too.
Blackstone becomes Wall Street’s deals backstop 23 Apr 2020 Advisory boutiques like Evercore and Moelis are putting their faith in private-equity firms to end the virus-induced merger drought. With $150 bln to invest, Steve Schwarzman’s outfit is the biggest, and ready to pounce. The juicy fees from big buyouts are a way off yet, though.
Private banks’ loan push will survive virus scare 23 Apr 2020 Plunging markets triggered margin calls on lending to rich clients. Yet Credit Suisse’s modest first-quarter provisions on such loans show big wealth managers can manage the pain. The promise of quick credit should ensure billionaires like SoftBank’s Masayoshi Son keep borrowing.