Asset Management Awards for Excellence 2017 – Best Fund Provider – High Yield Bond

AllianceBernstein

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After 2015’s commodity price free fall and the ripple effects from Chinese growth concerns, 2016’s high yield markets opened grossly undervalued, providing early fuel to close the year at +17.1%, according to Barclays’ High Yield index – the best performing sector within the fixed income universe.

Tightening spreads and continued demand for yield added to a relatively benign first half which also saw commodity prices stabilise, much to the relief of dominant energy companies within high yield benchmarks. For those Asian HNWIs’ chasing income, default rates remained below historical averages and are not expected to move significantly in the foreseeable future.

But Trump’s reflationary promises and a more hawkish Federal Reserve (which could possibly be joined by the ECB in 2018) threaten to end a more than 30-year bond bull that began in the 1980s after former chair Paul Volcker raised cash rates to a peak of 21.5% to tame inflation. Whilst there are few signs that an aggressive tightening cycle will play out – especially after Bernanke’s indelicate taper tantrum fiasco in 2013 – the subsiding of cheap liquidity in global markets will exacerbate risks and increase the need for best-inclass due diligence.

Leveraging from over 60 credit analysts across the disciplines of fundamental and quantitative research and a global footprint that spans 20 countries, AllianceBernstein has earned vote of confidence from fund selectors at Asia’s private banks. In addition to investment performance, AllianceBernstein continues to demonstrate care beyond its products, capitalising on its deep experience as a business that sources more than 16% of its US$450 billion of AUM from private clients. Gatekeepers have chosen AllianceBernstein as this year’s Best Fund Provider – High Yield Bond.