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TwentyFour Partner and Portfolio Manager, Gordon Shannon, discusses how the investment grade strategy has performed in Q4 2021 and provides his outlook for the new year.

If 2021 was a bad year for global bond returns, it follows there were few natural shelters to be found within fixed income from the brunt of inflation and rates-driven volatility; the Barclays Global Aggregate Index (a widely used broad measure of bond performance) returned -4.7% in USD terms, while European investment grade credit returned -1.1% despite credit spreads tightening over the course of the year.

Inflation was the dominant theme across financial markets in 2021, and we think it is likely to be a big driver of returns again in 2022.

With inflation and rate hikes dominating market discourse, we expect floating rate assets such as ABS and CLOs to benefit from increasing demand in 2022.

It has been a very interesting start to the year in the rates sector of the market.

Électricité de France (EDF) shares fell by as much as 25% on Friday morning after the French government announced exceptional measures to limit the impact of high electricity prices on French consumers, at the expense of the energy provider – the shares are down over 30% since start of December. 

The first two trading weeks of the year are coming to an end and unlike previous years they have been packed with activity.

After an interesting start to the year that has already brought large moves in rates markets and kept inflation in the headlines, Eoin Walsh looked at the major headwinds facing fixed income investors and laid out the reasons why we are positive on the asset class in 2022.

TwentyFour Asset Management, the London and New York-based specialist fixed income investor, has announced the appointment of a new partner from within its portfolio management team.

As we enter the third year of the pandemic, most market participants are asking themselves (once again) if this will be the year when supply chain issues finally abate.

As we enter the New Year, we say goodbye to an old “friend” that has accompanied us (for better and for worse) since the inception of the UK ABS market in the late 1980s – Sterling LIBOR.

Given the swiftness of the Fed’s pivot we think risks are tilted towards the central bank doing more and not less. We wouldn’t even rule out a 50bp rate hike at some point.