Prudential's Collins Sees Global Yield Curve Flattening

The video discusses asset management strategies, focusing on the impact of the Bank of Japan's policy on global bond markets. It highlights the effects on yield curves and investment opportunities, particularly in credit sectors. The discussion also covers credit risk, market dynamics, and the potential of emerging markets as investment destinations. The video emphasizes the importance of understanding global market trends and adapting investment strategies accordingly.

What is the primary effect of the Bank of Japan's action on the 10-year JGB?

• Pegging the 10-year JGB at zero

• Raising interest rates globally

• Decreasing investment in long bonds

• Increased volatility in global yield curves

How does 'lower for longer' interest rates influence investment strategies?

• Increases the reach for yield in credit sectors

• Decreases the demand for corporate bonds

• Promotes higher interest rates

• Encourages investment in short-term bonds

What is a misleading aspect of the current credit risk scenario?

• Banks have the highest leverage

• Large-cap companies have significantly increased leverage

• Only small companies have high leverage

• All companies are equally leveraged

What trend is observed in emerging markets post-Brexit?

• Higher interest rates

• Beginning of a virtuous cycle

• Increased currency stability

• Decreased capital flows

What is the expected outcome for emerging markets as they attract more capital?

• Increased central bank rates

• Decreased investment opportunities

• Higher currency volatility

• Lower yields and spreads