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Bloomberg Markets Magazine

Bloomberg Markets Magazine December/January 2018

Bloomberg Markets is the best kept secret in the financial industry. Get Bloomberg Markets Magazine digital subscription today and learn what many Hedge Fund and Portfolio Managers already know. Bloomberg Markets is the must have guide to what's happening now, and what will happen in global finance.

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Country:
United States
Language:
English
Publisher:
Bloomberg Finance LP
Frequency:
Back issues only
$9.99

in this issue

9 min
benchmark bouncers: index providers rule the world— for now, at least

IN SEPTEMBER 2015, Peru’s then-finance minister abruptly changed his plans and hopped on a jet to New York. By the time Alonso Segura Vasi landed in the U.S., officials from the country’s central bank and securities regulator were also en route to join him. What prompted a bevy of Peruvian officials to make the eight-hour journey wasn’t a matter of urgent statecraft or diplomacy. Instead, it was a rumor that the financial company MSCI Inc. might oust the South American country from its widely followed emergingmarkets index, a prospect that Vasi knew required immediate intervention. “Peru is not a name for the frontier market,” says Vasi, who’s now the finance director at Pontifical Catholic University of Peru. While he says that Peru has a small presence in the emerging-markets index, reclassifying it…

11 min
a tax h aven’s final days

IN VANUATU, a remote archipelago in the South Pacific, a popular tourist attraction is something called land diving. Villagers on the lush outer island of Pentecost jump headfirst from a tall wooden tower with tree vines tied to their ankles to break their fall. For the divers, the rite of passage is a plunge into the unknown—and that’s not a bad metaphor for where this secretive tax haven is headed these days. Anchored in the deep seas between Australia and Fiji, this exotic microstate has faced sanctions since last year for not complying with stricter anti-money-laundering standards established by the Financial Action Task Force. The FATF, an intergovernmental body created by the Group of Seven leading industrial countries, has placed the former Anglo-French colony on its “gray list,” which also includes…

5 min
what to talk about when you talk about brexit

FLOWS CAN PROVIDE powerful insights into economic and market trends. Both long-term foreign direct investment and shorter-term portfolio flows can be viewed as the business and investing communities’ judgment on policymakers’ economic and regulatory decisions. Buying a stake in a company or shares of an exchange-traded fund, for instance, could imply a vote of confidence. For insights into long- and short-term capital flows, you can use a couple of Bloomberg data analytics, which cover both cross-border M&A activity and portfolio flows. THE U.K.’S JUNE 2016 Brexit vote provides a perfect case study in how an unexpected political outcome can have a significant impact on perceptions by the global investor community. As Brexit nears its expected implementation of March 2019, one of the biggest fears is that multinational companies will no longer see…

4 min
how has trump altered the landscape for esg investors?

John Streur PRESIDENT AND CEO CALVERT RESEARCH & MANAGEMENT Keep an eye on regulatory rollbacks So far, says John Streur, “company managements are behaving better than the government” by adhering to international agreements. But the administration isn’t only easing regulations when it comes to climate and other issues, it’s also reducing the level of enforcement. Calvert is keeping an eye on companies that may be trying to benefit from that shift. “No companies are coming out publicly and saying, ‘We’re going to change our sustainability practices,’” he says. “But what we’re watching for is lobbying activity and political contributions and efforts to promote these alternativeinformation sources on scientific information.” One area of scrutiny is the auto industry, where Streur has seen efforts to roll back efficiency regulations. He expects to engage in the coming year…

3 min
10 easy ways to improve your 2018

1 Understand Your Bond Portfolio The Federal Reserve is beginning to reduce its $4.5 trillion balance sheet. What do potential shifts in the yield curve mean for your portfolio? Find Fed holdings aggregated by their maturity dates and the percentage of each individual issue owned by the central bank. 2 Balance All Those Assets Regulatory frameworks created since the 2008 Lehman Brothers crisis aim to reduce the systemic risk of the financial sector. While market risk measures are near their lowest levels since the crisis, are you prepared for them to increase? Measure the impact of potential shocks on your multi-asset-class portfolio. 3 Pay Attention to Subtle Signals The U.S. stock market has been on a tear over the past year. Can the momentum continue in 2018? Check dividend growth forecasts and compare sales and…

6 min
manuel henriquez has been dealing with a few things, ok?

FOR MANUEL HENRIQUEZ, the founder and chief executive officer of Hercules Capital Inc., if ever there were a year to remember—or maybe forget—this would be it. Before May, things had been going pretty well for Hercules, the largest nonbank venture-debt provider. Its shares had risen almost 27 percent in the previous 12 months. Total return, including dividends of $1.24 per share paid out over the same period, was running about 39 percent—more than twice that of the S&P 500 index. And then the press release went out. It was 5:04 p.m. Eastern Daylight Time on Wednesday, May 3, so markets were closed. The reaction from investors came the next day, when shares of Hercules plunged 12 percent. The release said the company had filed proxy materials seeking approval from shareholders for a newly…