The potential for a 'Taper Tantrum II' has been touted by a number of market commentators in the months leading up to the Fed's meeting this month.
But following the Fed's decision not to raise rates in September, this potential scenario has been pushed backed as investors look to realign their forecasts with Thursday's announcement.
When the Fed does decide to raise rates, markets will be impacted, to what extent remains to be seen. In order to give you a head start on planning for the future Citywire Ameriacs reveals the bond managers that best rode the period of volatility following the 'Taper Tantrum' of 2013 after former Fed chairman Ben Bernanke's QE tapering announcement.
3. Jon Mawby/Steven Roth/Andy Li – Man Group
Fund: Man GLG Flexible Bond
Total returns May 2013 – August 2015: 6.24%
Kicking off our top three ranking is the Man Group trio of Mawby, Roth (both of whom are Citywire A-rated) and Li. Their appearance in this ranking is for the GLG Flexible Bond fund, a long-only credit fund which invests across the full spectrum of USD- denominated debt across sectors and geographies.
The fund was launched in January 2013, a mere four months before the ‘Taper Tantrum’ frenzy hit bond markets and since May 2013 the trio have outperformed their Citigroup US Gov Bond All Maturities Local Currency benchmark which rose 4.1%.
2. Michael Pfeiffer – KEPLER
Total returns May 2013 – August 2015: 6.71%
Next in our line-up Citywire AA-rated Pfeiffer, bond manager at Austrian fund house KEPLER FONDS. His Ucits fund is domiciled in Austria and invests in US dollar-denominated debt issued by countries and corporations from around the world.
His fund beat its Barclays US Aggregate Bond benchmark over the analysis period which rose 5.24%. The US makes up his largest country allocation at 17.4%, followed by Holland (10.9%) and the UK (9.2%). Almost two third of his allocation (63.5%) is focused on corporate issuers with sovereign making the bulk of the remainder at 23.1%.
1. Anthony Smouha – GAM
Total returns May 2013- August 2015: 18.95%
Topping our ranking of best performing US dollar bonds manager is Citywire AAA-rated Smouha, a regular leading performer in this sector.
His $1.2 billion fund focuses predominantly on high yield bonds issued in US dollars with also a 30% allocation to BBB-rated paper. The UK is well represented in his top ten holdings with Smouha holdings bonds from five British issuers, including Lloyds Bank, Aberdeen AM and HSBC Bank.
He comfortably outperformed its benchmark, the BofA Merrill Lynch US High Yield BB-B Rated, more than doubling its rise of 7.09% over the analysis period.