Welcome!

News Feed Item

Pyramis Global Advisors Survey Reveals Surging Demand for Global Fixed-Income Strategies Amid Historically Low Yields

Home Market Bias on the Wane

Search for Yield Fueling Interest in Emerging Market Debt Strategies

SMITHFIELD, RHODE ISLAND and HONG KONG, PRC, Dec. 6, 2012 /CNW/ - Forty-three percent of institutional investors worldwide will likely increase exposure to global bond strategies in the coming years, according to a Pyramis Global Advisors® survey of pension schemes and other institutions from Europe, Asia and North America. These respondents oversee more than USD$5 trillion in assets.

Yields in many developed markets are extremely low, causing institutional investors from Europe to Asia to look beyond their home markets for fixed-income strategies that can deliver higher yields. In Europe, 38% of investors surveyed said they will likely increase allocations to non-domestic fixed-income strategies. The trend is even more pronounced in Asia, with 54% of investors indicating plans to increase exposure to non-domestic fixed-income strategies.

"With historically low yields in many safe haven bond markets and increased credit risk in a number of European countries, it is not surprising that many institutional investors are beginning to look beyond their borders," said Charlie Morrison, president of Fixed Income.

Growing Demand for Emerging Market Debt

Globally, 24% of investors surveyed said they will increase allocations to emerging market debt (EMD) over the next few years.

  • 37% of Asian institutional investors plan to increase allocations to hard currency EMD while 33% will likely increase exposure to local currency EMD
  • 47% of European institutional investors plan to increase allocations to local currency EMD, while 36% will likely increase exposure to hard currency EMD
  • 11% of U.S. institutional investors plan to increase allocations to local currency EMD while 13% will likely increase exposure to hard currency EMD
  • 15% of Canadian investors will likely increase exposure to EMD.

"The trends for emerging market debt remain positive," said Tom Hense, chief investment officer of the High Income division. "Attractive yields and improving credit fundamentals are fueling investor demand in these markets."

Currency and Derivatives Policies Evolving

The 2012 survey also indicated changing attitudes toward currency hedging. Traditionally seen as a way to hedge risk, currency hedging is now seen by many investors as a potential source of alpha as well. This trend is most apparent in Asia, where 47%of investors surveyed view currency as both an added risk to the portfolio and a potential source of alpha. This view was also held by 30% of the investors surveyed in Europe, followed by 24% of the respondents in Canada and 21% of the survey participants in the U.S.

The use of derivatives, which fell out of favor after the financial crisis in 2008, is once again on the rise. Sixty-four percent of all investors surveyed allow their managers to use derivatives. Of those surveyed, 47% use derivatives for downside protection, 43% use them to tactically adjust beta exposure and 42% use them to lengthen duration.

About the survey

Pyramis Global Advisors conducted a survey of institutional investors during June and July 2012, including 632 investors in 16 countries (193 U.S. corporate pension plans, 109 U.S. government pension plans, 92 Canadian pension plans, 149 European and 89 Asian institutions, including pensions, insurance companies and financial institutions). Assets under management represented by respondents totaled more than $5 trillion USD. The surveys were executed in association with Asset International, Inc., in the U.S., the Canadian Institutional Investment Network in Canada, and the Financial Times in Europe and Asia. Institutional executives responded to an online questionnaire or telephone inquiry. A report on the survey is available at www.pyramis.com

About Pyramis Global Advisors

Pyramis Global Advisors, a Fidelity Investments company, delivers asset management products and services designed to meet the needs of institutional investors around the world. Pyramis is a multi-asset class manager with extensive experience managing investments for, and serving the needs of, some of the world's largest corporate and public defined benefit and defined contribution plans, endowments and foundations, insurance companies, and financial institutions. The firm offers traditional long-only and alternative equity, as well as fixed income and real estate debt and REIT investment strategies. As of September 30, 2012, assets under management totaled more than $190 billion USD. Headquartered in Smithfield, RI, USA, Pyramis offices are located in Boston, Toronto, Montreal, London and Hong Kong.

635512.1.0
© 2012 FMR LLC. All rights reserved.

SOURCE Pyramis Global Advisors

Image with caption: "Investors Planning To Increase Exposure To Emerging Market Debt In The Next 1-2 Years (CNW Group/Pyramis Global Advisors)". Image available at: http://photos.newswire.ca/images/download/20121206_C6727_PHOTO_EN_21625.jpg

Image with caption: "Investors Who View Currency As Both An Added Risk And A Potential Source Of Alpha In A Portfolio (CNW Group/Pyramis Global Advisors)". Image available at: http://photos.newswire.ca/images/download/20121206_C6727_PHOTO_EN_21626.jpg

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
Deep learning has been very successful in social sciences and specially areas where there is a lot of data. Trading is another field that can be viewed as social science with a lot of data. With the advent of Deep Learning and Big Data technologies for efficient computation, we are finally able to use the same methods in investment management as we would in face recognition or in making chat-bots. In his session at 20th Cloud Expo, Gaurav Chakravorty, co-founder and Head of Strategy Development ...
SYS-CON Events announced today that Linux Academy, the foremost online Linux and cloud training platform and community, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Linux Academy was founded on the belief that providing high-quality, in-depth training should be available at an affordable price. Industry leaders in quality training, provided services, and student certification passes, its goal is to c...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm. In his Day 3 Keynote at 20th Cloud Expo, Chris Brown, a Solutions Marketing Manager at Nutanix, will explore t...
In his session at Cloud Expo, Alan Winters, an entertainment executive/TV producer turned serial entrepreneur, will present a success story of an entrepreneur who has both suffered through and benefited from offshore development across multiple businesses: The smart choice, or how to select the right offshore development partner Warning signs, or how to minimize chances of making the wrong choice Collaboration, or how to establish the most effective work processes Budget control, or how to m...
"delaPlex is a software development company. We do team-based outsourcing development," explained Mark Rivers, COO and Co-founder of delaPlex Software, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
SYS-CON Events announced today that Technologic Systems Inc., an embedded systems solutions company, will exhibit at SYS-CON's @ThingsExpo, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Technologic Systems is an embedded systems company with headquarters in Fountain Hills, Arizona. They have been in business for 32 years, helping more than 8,000 OEM customers and building over a hundred COTS products that have never been discontinued. Technologic Systems’ pr...
SYS-CON Events announced today that CA Technologies has been named “Platinum Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY, and the 21st International Cloud Expo®, which will take place October 31-November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. CA Technologies helps customers succeed in a future where every business – from apparel to energy – is being rewritten by software. From ...
In his keynote at @ThingsExpo, Chris Matthieu, Director of IoT Engineering at Citrix and co-founder and CTO of Octoblu, focused on building an IoT platform and company. He provided a behind-the-scenes look at Octoblu’s platform, business, and pivots along the way (including the Citrix acquisition of Octoblu).
SYS-CON Events announced today that Auditwerx will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Auditwerx specializes in SOC 1, SOC 2, and SOC 3 attestation services throughout the U.S. and Canada. As a division of Carr, Riggs & Ingram (CRI), one of the top 20 largest CPA firms nationally, you can expect the resources, skills, and experience of a much larger firm combined with the accessibility and atten...
What if you could build a web application that could support true web-scale traffic without having to ever provision or manage a single server? Sounds magical, and it is! In his session at 20th Cloud Expo, Chris Munns, Senior Developer Advocate for Serverless Applications at Amazon Web Services, will show how to build a serverless website that scales automatically using services like AWS Lambda, Amazon API Gateway, and Amazon S3. We will review several frameworks that can help you build serverle...
SYS-CON Events announced today that Loom Systems will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Founded in 2015, Loom Systems delivers an advanced AI solution to predict and prevent problems in the digital business. Loom stands alone in the industry as an AI analysis platform requiring no prior math knowledge from operators, leveraging the existing staff to succeed in the digital era. With offices in S...
SYS-CON Events announced today that HTBase will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. HTBase (Gartner 2016 Cool Vendor) delivers a Composable IT infrastructure solution architected for agility and increased efficiency. It turns compute, storage, and fabric into fluid pools of resources that are easily composed and re-composed to meet each application’s needs. With HTBase, companies can quickly prov...
SYS-CON Events announced today that T-Mobile will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. As America's Un-carrier, T-Mobile US, Inc., is redefining the way consumers and businesses buy wireless services through leading product and service innovation. The Company's advanced nationwide 4G LTE network delivers outstanding wireless experiences to 67.4 million customers who are unwilling to compromise on ...
SYS-CON Events announced today that Cloud Academy will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Cloud Academy is the industry’s most innovative, vendor-neutral cloud technology training platform. Cloud Academy provides continuous learning solutions for individuals and enterprise teams for Amazon Web Services, Microsoft Azure, Google Cloud Platform, and the most popular cloud computing technologies. Ge...