- Advertisement -
- Advertisement -

Q1 2024 Credit Outlook: Three Key Themes in Credit

- Advertisement -

By Sriram Reddy – Man GLG: While Europe provides a rich hunting ground for credit investors, upcoming maturity walls and refinancing pressures pose opportunities as well as risks.

Introduction

The biggest surprise to us in 2023 was the way in which economies shrugged off the most rapid Federal Reserve (Fed) monetary tightening since the 1980s. Furthermore, markets have quickly latched on to the idea of early and aggressive rate cuts in 2024 as inflation normalises. While it is entirely possible that continued consumer strength will result in a soft landing, it is by no means the only potential outcome and we think it is premature for equity and credit markets to price this in with complete certainty, as reflected in the 2023 equity and credit rally.

A good number of questions will be answered in 2024. Where will commercial and residential real estate land? How will the largest global economies land? Will ongoing geopolitical conflicts and China trade policy be resolved? And potentially the most significant – who will win the US presidential election in 2024 and will it be uncontested, and how will corporates refinance a mountain of 2025 and 2026 maturity debt?

Large swathes of credit and equity markets are at eye wateringly expensive levels and we have witnessed very little volatility to get here. We believe 2024 is likely to be forthcoming for volatility and arbitrage-type returns and unlikely to be a good environment for pure credit beta. Investors should be selective and build in some caution to more cyclically oriented parts of the market which price in little premium to more defensive segments. Here, we highlight three themes in credit which we will be watching closely in 2024.

Read the full article here.

Subscribe to HedgeBrev, HedgeNordic’s weekly newsletter, and never miss the latest news!

Our newsletter is sent once a week, every Friday.

Man Group
Man Grouphttp://www.man.com
Man Group is a global, technology-empowered active investment management firm focused on delivering alpha and portfolio solutions for clients. Headquartered in London, we manage $151.7 billion* and operate across multiple offices globally. *As at 30 June 2023.

Latest Articles

Leveraging Opportunities in Credit Markets

Stockholm (HedgeNordic) – After several years of successful bond investing through a private investment company, Nicolai Wenckheim launched an alternative investment fund in March...

ATP’s Response to Changing Equity-Bond Correlations

Stockholm (HedgeNordic) – In 2022, the usual negative correlation between equities and bonds, essential for the construction of diversified portfolios, disappeared. This rare anomaly,...

Evolution in Hedge Fund Investing with LGT Collaboration

Stockholm (HedgeNordic) – Since Peter Ragnarsson assumed the role of Head of Alternatives at PRI Pensionsgaranti in 2015, the Swedish pension insurer has significantly...

Borea Expands Sustainability Focus with New Hire

Stockholm (HedgeNordic) – Norwegian fund boutique Borea Asset Management has expanded its management team with the hiring of Iselin Ahmer Solberg as a corporate...

Schroders Strengthens Nordic Client Team

Stockholm (HedgeNordic) – Schroders is expanding its client relationship capabilities in the Nordics with the appointment of Ludvig Löfving as a Client Director. He...

The Lynx Constellation Is Brightening Up

Stockholm (HedgeNordic) – Lynx Asset Management made headlines in late 2019 with the launch of its pure-play machine learning strategy, Constellation, as a standalone...

Allocator Interviews

Latest Articles

Man Institute Insights

Voices

Request for Proposal

- Advertisement -