Director - Research, Consulting and Advisory, BondAdviser

Nicholas Yaxley

Director - Research, Consulting and Advisory

Australian bonds & fixed income research

BondAdviser

BondAdviser is the central reference point for intelligent information on Australian fixed income markets. We help you make informed decisions by providing unbiased research, transparent pricing data, analytics, portfolio tools and education.

BondAdviser has the broadest coverage of retail-accessible ASX-listed and over-the-counter Australian bonds and fixed income securities. We make it easy for you to review and compare investments before you place an order with your broker or dealer.

Thematic (Sector/Industry)

Australia Financials / Thematic (Sector/Industry)

Our investment strategy remains closely linked to the normalisation of interest rates globally and the domestic cash rate on hold.  Our expectation of a bumpy road (for treasury bonds) seems to be playing out as expected with economic data disappointing the market and inflation expectations oscillating between inflation and deflation.The rapid reversal in 2016 inflation expectations has mostly began after the failure of proposed US Healthcare legislation in March 2017. As this was the first major hurdle for the Trump Administration, the market has now lost faith in the pro-growth agenda, causing a rally in US Treasuries (lower yields).  This was until more recently when the Federal Reserve and European Central Bank (ECB) began discussing their respective balance sheet unwinds. Domestically the interest rate market remains benign and is taking the majority of its leads from offshore.The technical environment continues to dominate domestic credit and consequently, the largest risk across listed and wholesale markets remains liquidity.  Investment managers trying to execute an active investment strategy will find it increasingly difficult to rotate in and out of positions meaning primary market participation has become an increasingly important tool to add alpha.  Testing the depth of the secondary market remains an unknown risk to all participants should a systemic market event (or liquidity event) occur (not our base-case scenario).Direct investment remains our preferred investment strategy and although there have been limited tactical trading opportunities across the credit risk spectrum we continue to believe this approach will continue to outperform passive ‘long-only’ market aggregate index strategies.

Our investment strategy remains closely linked to the normalisation of interest rates globally and the domestic cash rate on hold.  Our expectation of a bumpy road (for treasury bonds) seems to be playing out as expected with economic data disappointing the market and inflation expectations oscillating between inflation and deflation.The rapid reversal in 2016 inflation expectations has mostly began after the failure of proposed US Healthcare legislation in March 2017. As this was the first major hurdle for the Trump Administration, the market has now lost faith in the pro-growth agenda, causing a rally in US Treasuries (lower yields).  This was until more recently when the Federal Reserve and European Central Bank (ECB) began discussing their respective balance sheet unwinds. Domestically the interest rate market remains benign and is taking the majority of its leads from offshore.The technical environment continues to dominate domestic credit and consequently, the largest risk across listed and wholesale markets remains liquidity.  Investment managers trying to execute an active investment strategy will find it increasingly difficult to rotate in and out of positions meaning primary market participation has become an increasingly important tool to add alpha.  Testing the depth of the secondary market remains an unknown risk to all participants should a systemic market event (or liquidity event) occur (not our base-case scenario).Direct investment remains our preferred investment strategy and although there have been limited tactical trading opportunities across the credit risk spectrum we continue to believe this approach will continue to outperform passive ‘long-only’ market aggregate index strategies.

Second Half 2017 Outlook: Where to from Here?