The 2014 All-Asia Research Team: Credit Strategy, No. 2: Michele Barlow & team
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The 2014 All-Asia Research Team: Credit Strategy, No. 2: Michele Barlow & team

Michele Barlow & team

Bank of America Merrill Lynch

First-place appearances: 7

Total appearances: 10

Team debut: 1997

Michele Barlow and her Hong Kong–based crew at Bank of America Merrill Lynch slip one position to second place yet retain an avid following. “Michele and her team have a good breadth of understanding,” reports one advocate. “You can throw almost any idea at them, and they’ll have something interesting to say.” Barlow and her colleagues recommend that investors build exposure at the lower end of the region’s investment-grade credit spectrum, favoring triple-Bs, because this segment “offers a cushion against higher interest rates coupled with relatively stable fundamentals,” she says. “We also like being down the capital structure in banks.” More broadly, the analysts urge clients to favor banks’ credits over corporates’, citing more-limited supply and the financial institutions’ generally sound capital positions, although they do “expect a modest deterioration in asset quality,” Barlow notes. Among corporate securities, they believe that “investors can benefit from yield in perpetuals and bank stand-by-letters of credit,” she adds, but advise selectivity and attention to credit structure. Finally, the team leader says, “we are overweight the energy sector given stable fundamentals across both the investment-grade and high-yield spaces.”

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