Three months into 2020, coronavirus fears took hold of global markets — and fixed-income researchers watched as credit markets collapsed at a record pace.
“There was enormous dislocation and disruption from the first or second week of March until sometime in April — and this happened in virtually every market, including the most liquid as well as corporate credit and high yield,” said Vishwanath Tirupattur, global director of fixed income research at Morgan Stanley. “Liquidity dried up quite dramatically in a very short period of time.”
At the peak of market uncertainty, credit spreads had drastically widened, with U.S. high-grade credit spreads reaching above 250 basis points, and lower-rated sectors widening much further, according to Matthew Jozoff, co-head of fixed income, currencies, and commodities research at JPMorgan Chase & Co.
But just as quickly as credit markets blew up, central banks stepped in. Led by the U.S. Federal Reserve, monetary and fiscal policymakers globally took unprecedented actions to stabilize the economy, setting the stage for a rapid recovery in equity and bond markets.
This historic intervention “turned every single client on the street into aggressive buyers of credit,” said Michael Maras, head of global credit research at Bank of America. “Once the Fed was there, there was only one-way traffic.”
It was, as Tirupattur summed it up, “a pretty dramatic year” for credit investors. And that’s where the Global Fixed Income Research Team came in...
To select the members of our 2020 Global Fixed-Income Team, Institutional Investor solicited the opinions of bond and credit specialists at leading asset management firms around the world. We received responses from almost 5,000 investment professionals at 1,389 institutions.
Expanded macro sectors were polled by region for the US, Europe, Latin America, Japan, Asia ex-Japan, and Emerging EMEA. Credit sectors were polled for the US and Europe. Additionally, three global sectors were polled.
Participants first rated their top firms in regional sectors on a scale from 1-5, and then separately rated individual analysts or economists/strategists at those firms to create two distinct results for each sector. A numerical score was produced by weighting each vote based on the respondent’s fixed-income AUM for the region voted in and the ratings awarded.
Using those scores, ranks were then determined. Firms/analysts were designated runners‐up when their scores came within 35 percent of the third-place scores.
The individuals surveyed are kept confidential to ensure continuing cooperation. Voters must meet eligibility requirements, and winners must achieve a minimum vote count.