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QUARTERLY REVIEW

This issue: Flows and fundamentals US: Data dependency Europe: ECB activism Asia: China’s shadow banks Special focus: Active fixed income management
Summer 2013

of a less favourable nature. the US model of post-crisis monetary policy seems to have been effectively exported to the rest of the world. and we do not think this is China’s Lehman moment. There are important differences. . Concerns about its shadow banking system are being likened to the conditions which preceded the US subprime crisis. in early July. For investors. Fixing banks. Japan. the last five years tells us. The Bank of England is thought likely to adopt a similar approach. The hint that the US Federal Reserve would taper its programme of asset purchases assuming that the US economy – particularly jobs growth – was strong enough sent markets into a tailspin in June. So. however. is a slow process. the ECB adopted the US approach of giving forward guidance on shortterm interest rates. but clearly China’s banking system will remain a source of concern for some time.EFG International Comment If anyone doubted the importance of central banks to the world’s financial markets. are also being made in China. much bad news already seems discounted in the Chinese equity market. And. is keenly embracing US-style quantitative easing (QE) policies. Comparisons with the US. however. events of the early summer should lay their doubts to rest. although the precise details vary.

Such an analysis is. Japan has posted strong growth so far in 2013: probably helped by Abenomics. Economic surprises and bonds Citigroup Economic Surprises Index for major economies (lh axis) US 10-year government bond yield (rh axis) 60 Index. out of assets previously considered safe. This. continues to strive for a rebalancing of its economy away from export and investment dependence and toward more consumer-orientated growth.Quarterly Review Summer 2013 Overview After more than four years of very easy monetary conditions in the US. Expected changes in policy have led to some large fund flows. += better/-=worse than expected 40 20 0 -20 -40 -60 -80 -100 -120 2007 Economic data weaker than expected Economic data better than expected 5.5 1. financial markets are starting to adjust to a different environment. In the Eurozone. The US is making a good recovery from its credit and housing crises. however. many structural challenges remain to be addressed. such as gold. However. The summer is often a volatile time in financial markets and in that context such uncertain conditions may be expected to continue.0 2. Economic activity has.5 % 3. However. Figure 1 Contents 03 04 Asset market performance US: Data dependent QE tapering 05 UK: Double dip disappears 06 Europe: ECB activism 08 Asia: China’s shadow banks 09 Special focus: Active fixed income management . Growth is firm but the perennial fears of a hard landing have not been dispelled. The UK recovery lags that of the US but data revisions have seen the double dip disappear and growth seems to have recovered well in mid-2013. slow process and will be conditional on the strength of the economy – it will be data-dependent. fall with their yield rising.0 2008 2009 2010 2011 2012 2013 Source: Thomson Reuters Datastream. the phasing out of expansionary policies in the US will be a long. meanwhile. austerity fatigue can be seen in some countries and there is slow progress on the structural reforms which were designed to bolster the Eurozone. somewhat inappropriate in current circumstances: different economies are better described as being at varying stages in their post-crisis and structural adjustment. however. Better than expected data has typically seen the price of safe haven assets. at best. Recent capital losses on such assets have challenged the notion of their safety. stabilised.5 5. recession and so on. other countries are only now embracing US-style monetary policies (QE in Japan and forward guidance on rates in Europe). the jury is still out on whether or not that set of policies will ultimately succeed in boosting growth and eliminating deflation.0 1. In these circumstances there is a heightened sensitivity to data releases. China.0 3.5 2. is an environment in which a careful assessment of fundamentals needs to be set alongside the short-term vagaries of fund flows. Data as at 2 July 2013.5 4. at the very least with regard to the positive influence on confidence. What sort of growth? It is commonplace to describe economies as being at various positions in their economic cycle – recovery. Even so. such as US government bonds.0 4. Furthermore. core government bonds and inflation-protected securities. economic growth still remains weaker than longrun historic averages and the labour market is not yet strong enough to support an early withdrawal of monetary stimulus.

Figure 2 Figure 4 Flows and fundamentals Perhaps because economic growth does not yet seem to be on a secure footing. Philippines. they have driven up real exchange rates in a number of countries (for example Brazil. index tracking investing for such assets have been highlighted (see Special Focus on page 9). a changed perception is. Changing perceptions In that context. We return to these themes after a discussion of recent asset market performance. and Vietnam Source: JP Morgan.EFG International GDP: Japan vs US and Eurozone Japan 109 108 107 Index. We are cautiously optimistic that the aggressive set of policy measures introduced by the new government will have a positive short term impact on the economy although the longer term implications are less clear. Iran. Pakistan. Turkey and South Africa). even before these measures were introduced. Indonesia. we need to be mindful of the fact that fund flows into these economies in recent years have had. Other emerging economies have not been as adversely affected. Thomson Reuters Datastream. Although the importance of the emerging economies in driving global growth on a long-term basis remains intact. Source: IMF World Economic Outlook database. fears of tighter global liquidity have adversely impacted emerging market bonds. currencies and equities that had been favoured in the hunt for yield. The drawbacks of passive. Data as at 2 July 2013. In the emerging economies. the Japanese economy had made a respectable recovery from early 2009 – the trough of global activity. Japan has long been regarded as a structurally weak economy with entrenched deflation and poor demographics. in some cases warranted. Notably. Variations around that theme also need to be considered. Egypt. January 2003=100 120 110 100 90 80 70 03 N11* Eurozone US Japan 04 05 06 07 08 09 10 11 12 13 *Bangladesh. disorderly. a very distortionary effect. Q1 2009 = 100 106 105 104 103 102 101 100 99 2009 US Eurozone Current account balance: ten-year downtrend Brazil 2 Forecast 0 India Turkey South Africa -2 % of GDP -4 -6 -8 2010 2011 2012 2013 -10 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Source: Thomson Reuters Datastream. Turkey. indications that the US Fed may taper its quantitative easing (QE) programme (that is. reduce – then stop – its programme of asset purchases) have caused a number of dislocations in financial markets. South Korea. Nigeria. India. Figure 3 02 . impairing their competitiveness and bringing a deterioration in their current account balances. Data as at 2 July 2013. Real exchange rates BRIC 150 140 Less competitive 130 Index. at times. It is notable that. As well as the impact on safe-haven bonds. Data as at 2 July 2013. Fund outflows from many of these previously-popular assets have been substantial and. Mexico. in some cases.

total return US$ terms Equities. outweighed coupon income. which would entail a slower pace of Fed purchases of government and mortgage bonds. Equity market returns Local currency terms 40 US$ terms Six months to end-June 2013 30 20 % 10 0 -10 -20 Brazil Russia China India Australia UK Taiwan Switzerland Germany US Japan Source: MSCI. and government bonds negative. Figure 6 Past performance is not an indicator of future performance. The strongest performing countries were Japan. returns were further into negative territory: losses in the Japanese government bond market amounted to 12. MSCI (equities). That was most notable in Japan. Data as at 2 July 2013. Australia’s gains in local currency terms were transformed into losses in US-dollar terms as the currency weakened sharply. all the main developed equity markets returned positive local currency returns. In contrast. with a sharp fall in the yen’s value.8% in US$ terms. equities produced positive.7%). In the main emerging markets. Data as at 2 July 2013. Figure 5 Past performance is not an indicator of future performance. Losses in capital value. Equity markets The four main emerging equity markets – Brazil. as the dollar appreciated against most currencies in the period. In US dollar terms.6% in US$ terms and the US (up 13. with Japan’s gains amounting to 34%. Concerns about slowing Chinese growth and commodity prices weighed on the Australian dollar. returns in the first half of 2013. Bond markets Most developed world government bond markets recorded negative total returns in local currency terms in the first half of the year. as yields rose. US$ terms 20 Six months to end-June 2013 15 10 5 % 0 -5 -10 -15 -15 Japan Australia UK Switzerland US Eurozone Source: Citigroup. Behind the back-up in bond yields was a concern about the effects of a tapering of the US QE programme. Japan still produced the strongest dollar-terms returns in the first half. Currency weakness against the US dollar undermined the performance of almost all markets in dollar terms. Even so. total return. US Europe Japan Emerging World Source: Citigroup (bonds). India and China – all recorded losses in US dollar terms in the first half of the year. Data as at 2 July 2013.4%. Russia. Bond market returns Local currency terms US$ terms 5 Six months to end-June 2013 0 Asset market performance Overall world equities produced total returns in the first half of 2013 of 8. Figure 7 Past performance is not an indicator of future performance.Quarterly Review Summer 2013 Asset market performance In all of the main developed markets. Japan’s equity market the star performer in the first semester 03 . % -5 -10 Asset market performance Bonds. both bonds and equities posted losses in US dollar terms. with a gain of 16.

Figure 9 04 Fed moves on monetary policy are ‘data dependent’ . gains at that rate are unlikely to absorb all the new workers entering the labour market and the unemployment rate is likely to rise. Tapering decisions The importance of the US economy and monetary policy decisions to the entire world was underscored by the fact that all global financial markets were affected by recent Fed comments that it would start to taper its QE programme.0 Source: Thomson Reuters Datastream. State and local government spending Private sector spending US labour market Participation rate (lh axis) Unemployment rate (rh axis) 65. the Fed will still continue to buy government and mortgage bonds but at a slower rate.5 9. Importantly. As a result of the way GDP growth data are reported . the link between job creation and the unemployment rate is far from direct as there has recently been a steady fall in the participation rate (the share of the population in work or actively seeking work). The exit route from the US’s unorthodox policies will certainly take a long time and require a delicate balancing act. Over the first six months of 2013. we think it will justify a gentle taper in asset purchases. the increase averaged 190.000 per month a more rapid taper would be warranted.5 10.5 Source: Thomson Reuters Datastream.EFG International United States The health of the US economy will be carefully monitored during the summer as the US Federal Reserve has outlined that various economic criteria will be carefully assessed when judging the timing and pace of the exit from ultra-low interest rates and the scaling back and ending of quantitative easing (QE). If that pace in maintained. more specifically.5 -2 % 64.0 % 9.quarter on quarter annualised changes .0 0 64. However. Data as at 2 July 2013. Data as at 2 July 2013.0 8. the monthly change in non-farm payroll data.0 6 4 % change on year 2 65.5 8. Growth recovery The fact that US GDP growth has recovered sufficiently well enables such a step to be considered. offsetting the drag on overall GDP growth from lower government spending. Labour market is key However. Trends in the labour market will be the key factor behind the tapering of the Fed’s asset purchases.000 per month would signal no tapering.growth could well appear stronger in the third quarter as comparisons are made with the second quarter (in which the effects of government spending cuts were greatest). Tapering refers to scaling back the Fed’s monthly asset purchases from the current pace of $85bn.0 2010 2011 2012 2013 7 . In particular. If gains are above 200.000 jobs per month.5 -4 -6 2007 2008 2009 2010 2011 2012 2013 63. the most important economic information behind the tapering decision will be labour market data and. US GDP: government and private sector Overall GDP growth Federal. but less than 140. That is. Figure 8 63. the private sector is regaining momentum.

with data better than market expectations. Data as at 2 July 2013. UK equities Although UK 10-year gilt yields have risen to 2. amounts to forward guidance on policy interest rates. Figure 11 Policy change? This all means that when Mark Carney took over as Governor of the Bank of England on 1 July. The unemployment rate of 7 . but there is no doubt that conditions in the UK labour market are much better than almost everywhere in the Eurozone.5%. for example – but relative to expectations. Numbers in employment reached a new peak of 32.5% (on the FTSE All-Share index). in effect. the UK economy has been good at creating jobs. The UK produces more jobs. thanks to such revisions. That. they are still low in a long-term historic context.5%. The double-dip recession – the renewed drop in output in late 2011/early 2012 after the recession in 2008/9 – no longer exists. Source: Thomson Reuters Datastream.Quarterly Review Summer 2013 United Kingdom There are some brighter signs with regard to the UK economy allowing the Chancellor of the Exchequer to claim recently that it is out of intensive care. conditions were better than at the time his appointment was announced in November 2012. Employment levels fell only modestly in the recession – by 2. It is true that many of the jobs created are part time and lower-paid. UK equities. Nevertheless.8% is similar to that in the US. In the UK recently those surprises have been generally favourable. continue to provide attractive yield and total return prospects for longer-term investors. compared with 7% in both the early 1980s and early 1990s recessions. += better/-=worse than expected 80 60 40 20 0 -20 -40 -60 -80 2007 Economic data weaker than expected 2008 2009 2010 2011 2012 2013 Economic data better than expected Millions 29 28 27 26 25 1980 1985 1990 1995 2000 2005 2010 Source: Thomson Reuters Datastream. Double dip disappears as data turn more positive. Economic surprises In financial markets it is so often the case that economic data are judged not in an absolute sense – whether growth is positive or negative. Revisions to past data on GDP have also helped dispel some of the gloom. even in hard economic conditions 05 .3million in the first quarter of 2012. with a dividend yield of 3. Figure 10 Labour market Nevertheless. UK GDP in the first quarter of 2012 was still 4% lower than at its peak four years earlier. Even so. his first comments highlighted that the back-up in government bond yields could threaten continued growth and that they were unwarranted by prospects for short-term rates. UK employment UK total employment (millions) 33 32 31 30 Recessions UK economic surprises UK Citigroup Economic Surprises Index 120 100 Index. Data as at 2 July 2013. It is the surprise element which influences financial markets.

Some see the German general elections on 22 September. which has curbed imports). Moves towards banking union and the use of a common fund for bank recapitalisation were deemed urgent. current account deficits in the peripheral countries have narrowed sharply or moved into surplus (to a large extent because of weak domestic demand. += better/-=worse than expected 2008 2009 2010 2011 2012 2013 Source: Thomson Reuters Datastream. One year on. Mario Draghi has described the OMT as “probably the most successful monetary policy measure in recent times” . Progress has been made on plans for banking union. the decisions will be taken at a later date. low and there are many interesting stock-specific opportunities. because they distract German policy makers’ attention. tensions in the Eurozone have subsided and break-up risk is now considered a low probability. Although Eurozone equity markets have recovered since their trough last June. By that time the direct elections to the European Parliament (in late May 2014) will be looming. Although President Angela Merkel is widely thought likely to win. the eurozone’s €500bn rescue fund. a new German government is unlikely to be in place much before end-2013. So far. Financial Times. as one reason for the delay. but concrete structures are unlikely to be in place for some time. First. Third. 06 Decision making stalled . “EU leaders have decided…that when it comes to fiscal and economic integration within the eurozone. latest Previous peak (since 1990) 30 25 20 % 15 10 5 Eurozone economic surprises Eurozone Citigroup Economic Surprises Index 150 100 50 0 -50 -100 -150 -200 2007 Economic data weaker than expected Economic data better than expected 0 Germany France Italy Ireland Portugal Spain Greece Source: Thomson Reuters Datastream. Slow progress on structural issues… Perhaps most disappointing is the case of the ESM (European Stability Mechanism). that has not happened: concerns about the collateral requirements have been the main stumbling block and it is thought unlikely to be operational for another 18 months. economic data have been no worse than (admittedly low) expectations. entailing common supervision of large European banks. ” Peter Spiegel. and most important. Eurozone unemployment Unemployment rate. 28 June 2013. despite (or because of?) the fact that it has never been used. Figure 12 There are three main reasons for that. There is a realistic chance that parties broadly opposed to current EU policies will have a majority in that new parliament. This was designed to be able to recapitalise banks directly.EFG International Europe In mid-2012 it was seen as essential to develop a new framework to strengthen the operation of the Eurozone. little progress has been made on these issues. Data as at 2 July 2013. the ECB’s pledge to ‘do whatever it takes’ to save the euro last July. …but a more active ECB Despite these concerns. the announcement of Outright Monetary Transactions (OMTs) last September and the commitment to ‘maintain interest rates at present or lower levels for an extended period of time’ in July have calmed markets. Figure 13 Index. valuations are still. Data as at 2 July 2013. overall. Second.

so to some extent it can grow out of its problems. Many see echoes of the US’s credit crisis in China’s current problems. the other major difference is that an equity market bubble has not gone hand in hand with the growth of lending. has risen by a third since then. Indeed. Third. First. the parallels go only so far and we do not see this as China’s Lehman moment. For investors. which was stable at about 120% of GDP from 20032009. trebling in size to RMB23 trillion in the four years to the end of 2012. Spotlight falls on China’s shadow banks.1 The expansion of lending by the shadow banking system has magnified the expansion of credit by the banks themselves. and lending by retail money lenders to small companies and individuals. Hang Seng Indices (www. Enrich Professional Publishing (2013).com. Even so. 1 January 2000 = 100 2014 150 % of GDP 140 130 120 110 100 90 2000 Shadow banking 1000 800 600 400 200 2002 2004 2006 2008 2010 2012 0 00 01 02 03 04 05 06 07 08 09 10 11 12 13 Source: Thomson Reuters Datastream. Joe Zhang 'Inside China's shadow banking'. But this is not a Lehman moment. as in some of the other more export-orientated Asian markets. most recently. China: bank lending to the private sector Bank lending to the private sector Bank plus 'shadow' bank lending to the private sector 170 160 China & Hong Kong: stockmarket indices Shanghai Stock Exchange 'A' share index (restricted to mainland China domestic investors and qualified foreign investors) Hang Seng China Enterprises 'H' shares index (mainland China enterprises with H-share listings in Hong Kong) Hang Seng (main Hong Kong index) 1200 Index. Growth of lending has financed construction spending (infrastructure as well as housing).hsi. it has helped drive a surge in property prices. In China. some of the investment has been excessive (building roads to nowhere) and. with limited transparency so cleaning up any problems posed for the regulated banks by the shadow banks can be done more quietly. financial institutions stopped lending to each other. Figure 14 1 Figure 15 See Jo Zhang ‘Inside China’s shadow banking. Second. The expansion of credit by the Chinese shadow banking sector has been rapid. Source: Thomson Reuters Datastream.hk). banks are already state-owned.Quarterly Review Summer 2013 Asia China’s shadow banks have been known to pose a potential problem for some time. Events in late June. propelled the sector into the spotlight. we still see good value in equities. however. activities of non-bank financial institutions such as trust and leasing companies. the domestic Chinese equity market (the Shanghai Stock Exchange ‘A’ share index) is no higher than it was ten years ago. Could problems with China’s shadow banks result in a hard landing for the economy? 07 . The consequence has been that overall lending to the private sector. China’s shadow banks The term ‘shadow banking’ refers to three main types of financial activity: off-balance sheet activity by the banks themselves. the next subprime crisis?’ Enrich Professional Publishing (2013). China still has strong economic growth. savings levels are high and banks themselves have not lent excessively – the loan to deposit ratio is only 75% – whereas it was well above 100% for US banks before the crisis. with interbank interest rates briefly soaring to 25%. Data as at 2 July 2013.

as noted above. Abenomics and the stockmarket It will be many years before the success or otherwise of the set of policies known as Abenomics can be assessed. The three arrows of the policy are: renewed fiscal stimulus. The stockmarket has responded well to the measures with the Japanese equity market being the best performing developed market in the first half of 2013.but higher highs for profits Corporate profits and forecast (Yen trillions) 2000 peak 2007 peak 20 Forecast 18 16 Japan: lower highs for the stockmarket… Yen trillions 14 12 10 8 6 4 2 2000 22000 20000 18000 16000 Index points Nikkei 225 index 2000 peak 2007 peak 2002 2004 2006 2008 2010 2012 2014 14000 12000 Source: Thomson Reuters Datastream. 08 Strong profit growth in prospect . The pass-through from a weaker yen to higher imported goods cost has improved the outlook for inflation but reaching the 2% target remains some distance away. EFG forecasts. Corporate profits rebound Corporate profits. As a by-product of that set of policies. Data as at 2 July 2013 Figure 16 Perhaps because Japan’s equity market has been such a poor performer for such a long period of time. Figure 17 10000 8000 6000 Scepticism questioned 00 01 02 03 04 05 06 07 08 09 10 11 12 13 Source: Thomson Reuters Datastream. Japan’s equity market is no more expensive now than it was in late 2012. however. A new peak level for profits in 2013/14 looks a realistic prospect. scepticism about Japan’s prospects is widespread. amounting to ¥13 trillion ($150 billion. . It still remains. Indeed. Japan’s stockmarket has risen sharply since Abenomics was launched in late 2012 but it still offers good value. about 2. however. For the short term at least. to some extent as a result of the yen’s more competitive level. the yen has weakened sharply. despite a setback after its initial surge. below the previous peaks recorded in 2000 and 2007 ..EFG International Japan Although there has been a setback in the Japanese stockmarket after the initial sharp rise which accompanied the launch of Abenomics. and a series of structural reforms to help improve competitiveness. a 2-2-2 monetary policy – a doubling of the monetary base in 2 years to reach a 2% inflation target. Data as at 2 July 2013. Furthermore. we are taking a more optimistic view with regard to the outlook for Japanese equities. on the basis of consensus twelve month forward earnings expectations. Japan’s GDP growth since 2009 has been on a par with the US and strong 2012 first quarter growth was recorded. we still see it as cheaply valued relative to the trend in profits. have already risen and are generally expected to grow strongly this year.7% of GDP).. and because Japan’s economy has repeatedly disappointed.

Essentially. they often traded at a discount to the underlying value of the bonds held in the funds. Our approach to active fixed income investing is to focus on fundamental value. rather than passive. for example. as seen recently. That is the philosophy behind our EFG New Capital Wealthy Nations Bond Fund*. The sell-off demonstrates to us one technical drawback of investing in fixed income instruments via a passive fund. the problem is that the liquidity offered to investors in the passive fund was greater than in the underlying investments. with the focus on longer-term structural factors can benefit from such an environment. Data as at 2 July 2013. In bond indices. In turbulent conditions. The advantages of active. At the start of the year we were concerned that there was little value in many government bond markets that were viewed as safe. fixed income management. That is unsurprising given that such bonds typically trade on the basis of a yield spread over Treasury bonds. on an intra-day basis.72% in late-December 2012 to 2.50% in early July 2013. but they failed to do so. a government or corporate issuer has a larger weight the more debt that is outstanding. such as ourselves. such as emerging market bonds. Investors. We were concerned that many investors in such bonds were not paying adequate regard to the risk of a rise in yields and the consequent decline in capital values. ‘Safe’ bonds have been far from safe. That has brought an almost 7% fall in the price of such bonds. liquidity and flow-related developments. our active management allows us to reposition toward bonds that have underperformed due to technical. Spread based on current weights in EMBI index Figure 18 2 * The value of your investment may fall as well as rise and you may not get back your original investment. Flows out of many bond funds were substantial. 2013 Q1 ‘Investing in safe government bonds’.Quarterly Review Summer 2013 Special focus: Active fixed income management The announcement that the US Federal Reserve would start tapering its purchases of fixed income securities under its Quantitative Easing programme led to a sharp sell-off in many fixed income instruments around the world. we remain skeptical of the merits of such passive investing in fixed income markets. weaken as well. The experience emphasises to us the importance of active fixed income management and underscores the problems of passive. Such passive funds seek to replicate the behavior of one of the widelyused fixed income indices. 09 . Emerging market bond spreads Emerging market bonds – yield spread over US Treasuries (based on actual historic weights in Emerging Markets Bond Index) 16 14 12 10 8 6 4 2 0 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 Source: EFG. The sell-off in government bonds has seen other bond markets. Funds tracking the index failed to do so with the precision that investors expected. The emphasis is on investing in bonds issued by countries which have strong national balance sheets and external asset positions. That means a greater amount is invested in poorer credits. and more fundamentally. index-tracking investing in this market. with 10-year US Treasury yields rising from 1. The outflow of funds was so substantial that. Additionally. which act as the benchmark. Basis points See EFG’s Quarterly Review.2 That risk has materialized.

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Although information in this document has been obtained from sources believed to be reliable. Curzon Street. arising from any errors or omissions. al.EFG INTERNATIONAL EFG Asset Management Matching portfolios to client needs Getting the right asset mix Capital preservation. AM RRQ . ALK . Ma luding the ustry mics. Bu the mo st. possible loss of principal invested. an ce rket ind Perfo 1 (ASM s long-tand dema t capa capit ustry months nce d earlie rtainly he t city rman or so alisati is stil and 1999 ). Our Financial Conduct Authority registration number is 144036. SKY W. In to the ch d t ncies uenc adva little or es signifi . ALG T. Then lines. currency exchange and market risks.” d ow 12 re no Air Fra . firstlyme for the and se 21 – easy condly it is tra last fiv our clie 25 Fe cin last 20part. alone 1 which The d the so sa an British Airmergers can. and such information may be incomplete or condensed. 2321802. income or growth? INVESTMENT SOLUTIONS FOR YOU Crafting investment solutions Get access to our latest investment publications by contacting your EFG International Client Relationship Officer. infl unionise our op uld no tcy. and is not intended to be a final representation of the terms and conditions of any product or service. requir in 1989 n Buffe tende ally. we saw d Ameri rm im e an d a quick rd Bran shootin ally en ati fthan we .pendent try that is try hard. 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All estimates and opinions in this document constitute our judgment as of the date of the document and may be subject to change without notice. the airline ok comp l becamehas beenan instin contrarian indus sically for indus try ct. We will not be responsible for the consequences of reliance upon any opinion or statement contained herein. y does s with thi t the se ma t reg ded pe target of unstable hly cyclic m an inv sy ctor It is no Airwa ny co escalat the chan this intere s in mind ulator is un ter ns es oil uld no ifo ing oil ging s an ion bu rorist ac prices.