Investment Talks -Factor Investing and ESG in the Corporate Bond Market Before and During the COVID-19 Crisis

Friday 13 November 2020

News, Investment Talks, Market News

We use monthly credit excess return in the EUR denominated Investment Grade bond universe for regression analysis and factor picking. ESG was making its way to becoming a mainstream factor within the Investment Grade universe and when the COVID-19 stress hit the financial markets, it displayed a “hedge-like” behavior. We had previously identified that better ESG and lower cost of capital were related, however the realization of this feature in a stress environment is worth investors’ attention.

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The objective of this paper is to illustrate the factor investing space in corporate bonds before and during the COVID-19 crisis and is the natural extension of our prior analysis on both the new alternative credit factors and the ESG integration in credit

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Vignette - Time to reconsider US growth
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2020 post-election analysis: Biden wins, but the United States remains divided

Final result: Former Vice President Joe Biden defeated President Trump to become the 46th President of the United States. While Trump has not conceded yet, he became only the third President to fail to win re-election since World War II. In the end, the election was a referendum on Trump as a man rather than an indictment of his policies. A political realignment is underway, with GOP emerging as a working-class party and dominating the vote in rural areas, while the ‘Blue wall’ of the Midwestern stattes of Pennsylvania, Michigan and Wisconsin has become competitive for both parties.