Economics & Strategy: Corporate Debt – Second
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Economics & Strategy: Corporate Debt – Second

BTG Pactual’s five-strong squad led by Alexandre Müller repeats in second place; this team also finishes first in Local-Markets Strategy and third in Sovereign Debt.

Alexandre Müller & team BTG Pactual


BTG Pactual’s five-strong squad led by Alexandre Müller repeats in second place; this team also finishes first in Local-Markets Strategy and third in Sovereign Debt. Clients praise the São Paulo–based strategists for providing a “big-picture view” and “a global context for their research.” The crew currently favors high-yield over investment-grade bonds, “as the average spread differential is relatively high for the recent past — although we realize the challenging environment for companies to report improving credit metrics,” Müller says. Against such a backdrop, investors should concentrate on companies relatively well positioned in their industries, he adds. Winning picks of late include the 7.875 percent 2018 Eurobonds of Brazil-based JBS, one of the world’s largest beef processors. The team recommended the bonds in mid-January when they were trading at a zero-volatility spread level of 860 basis points. By mid-July the Z-spread had narrowed by 90 basis points, to 770; during the same period the Z-spread of J.P. Morgan’s corporate emerging-markets bond index for Latin America widened by 10 basis points. — Thomas W. Johnson


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