Highlights US fixed income markets show higher January returns, but statistical tests confirm no significant “January effect.” Fund flows shift seasonally, with investors moving from money markets to bonds in January. September is the real outlier, showing a statistically significant decline across US Treasuries and investment-grade bonds. What is the January effect? January effect is a well-known market anomaly, where stocks—especially small caps—experience higher monthly performance in January than during the remaining months of the year. Recent data shows that the January effect in stock markets has become less pronounced over time. But there’s been far less research into whether US

  Toronto November 6, 2024:  LSEG Lipper unveiled the results of the acclaimed 2024 Canadian LSEG Lipper Fund Awards. These annual awards shine the spotlight on the asset management industry and recognize the funds that have consistently delivered strong risk-adjusted returns against its peers. This event gathered investment professionals, industry experts, and journalists from all over the country to help us acknowledge and celebrate the success of portfolio managers and the individuals who support them. A Tried & True Quantitative Approach. The LSEG Lipper award winners are not simply determined by picking the funds with the highest returns within classifications

Since the federal funds rate hit 5% in March 2023, the bond market has been battling it out with the central bank. The market assumed that the U.S. economy was heading for recession and required more accommodative monetary conditions. This negative outlook has been influenced by the pervasive loose monetary policy that was put in place in 2009, with investors believing that the economy needs lower interest rates in order to function. However, not only have investors forgotten what “normal” bond market conditions are like, they have also forgotten the adage “don’t fight the Fed!” Since the economy emerged from

When Ronald Reagan said that the nine most dangerous words in the English language were “I’m from the government and I’m here to help,” he provoked a storm of protest from all sides of the political debate. Governments clearly can help drive competitiveness through improved skills policies, by investing in infrastructure and housing, as well as supporting innovation through R&D and incentivizing capital investment towards startups. Indeed Reagan embarked upon a radical new industrial strategy – the Small Business Innovation Research program – which between 1995 and 2018 generated an additional $184 billion in value added. But governments and investors

The data in the article below is sourced from Lipper’s Global Fund Flows application. GFF can be found on LSEG Workspace (“FundFlows”). During LSEG Lipper’s fund-flows week that ended April 17, 2024, investors were overall net redeemers of fund assets (including both conventional funds and ETFs) for the fourth week in five, removing an astonishing $143.5 billion—the largest weekly outflow since the week ending September 16, 2009. Alternative investments (+$117 million) was the only group to attract inflows since last Thursday. Money market funds (-$118.5 billion), equity funds (-$19.5 billion), taxable bond funds (-$3.2 billion), municipal bond funds (-$1.5 billion),

Fixed income funds realized a return of positive 0.50% on average during the first quarter of 2024, marking their second straight quarterly gain and fifth plus-side quarterly return in their last six. Outside of Emerging Markets Hard Currency Debt Funds which saw nice gains thanks to a strong dollar, floating-rate and higher yielding funds were the top performers during the first quarter of 2024.

The current market debate on interest rates has tended to focus only on the money rate of interest, and hence on when the Federal Reserve might start to cut short term rates. The idea is that a cut in rates will make money cheaper and therefore boost equities. Over the last three months, although the five year government benchmark has remained pretty stable, shifting from 4.4% to 4.3%, the five year BBB rate has fallen from 6.2% to 5.7%. This is part of the reason why US equities have outperformed, with the Nasdaq composite index returning 12% in the last

The data sourced in the article below is derived from Lipper’s Global Fund Flows application. GFF can be found on LSEG Workspace (“FundFlows”). During LSEG Lipper’s fund-flows week that ended February 14, 2024, investors were overall net redeemers of fund assets (including both conventional funds and ETFs) for the third week in four, removing a net $918 million. Taxable bond funds (+$9.0 billion, -0.30%), equity funds (+$8.0 billion, +0.50%), and alternatives funds (+$502 million, +0.20%) attracted net new capital. Money market funds (-$17.5 billion, +0.10%), commodities funds (-$645 million, -2.30%), tax-exempt bond funds (-$142 million, -0.10%), and mixed-assets funds (-$138

Fixed income funds realized a return of positive 6.06% on average during the fourth quarter of 2023, marking a rebound from their third quarter loss (-1.70%). Fixed income funds have now reported four quarterly gains in the last five. Tax-exempt bond funds (+6.79%) outperformed taxable bond funds (+5.81%) for the first time all year as they recorded their second largest quarterly return on record, trailing only Q3 2009 (+7.73%). Despite the nearly 100 basis point (bps) outperformance, taxable bond funds returned their highest quarterly return since Q2 2020. Summary: All 51 Lipper fixed income classifications ended the fourth quarter with

The bond market remains confused about interest rates, which is why it continues to generate such unusual levels of volatility. One possible explanation for this ongoing uncertainty is that there is a fundamental difference of opinion between bond traders who have only experienced abnormal bond market conditions since 2008, and those who are, let’s say, long in the tooth. During the first half of 2023, the US 10 year nominal bond yield averaged just 3.63%, with the 30 year benchmark at 3.78%. The market appeared to be indicating that inflation would quickly fall back to 2% and that nominal demand

The data sourced in the article below is derived from Lipper’s Global Fund Flows application which may differ slightly from the Lipper US Fund Flow data due to timing and methodology. This new application can be found on LSEG Workspace. During LSEG Lipper’s fund-flows week that ended September 13, 2023, investors were overall net purchasers of fund assets (including both conventional funds and ETFs) for the third straight week, adding a net $18.7 billion. Equity funds (+$9.6 billion), money market funds (+$9.4 billion), and taxable bond funds (+$961 million) registered inflows, while alternatives funds (-$637 million), tax-exempt bond funds (-$306

Using the Lipper Leaders scoring system to analyse the best-performing funds in the IA Sterling Corporate Bond sector   Bonds, as we’ve been repeatedly told this year, are back. But are they worth backing? Bonds have been the asset class of choice for the year. UK investors have put £10.3bn into bond funds in the first six months of 2023. In contrast, equity funds have suffered £8.3bn of redemptions. While the value of bond principals has been hit hard as base rates have risen, this same process has, by definition, increased yields in outstanding bonds and forced new issuers to