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Invesco em corp_bonds_citywiregstaad_9_2013

Nov 22, 2014

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  • 1. Invesco Emerging Market Corporate Bonds Citywire Switzerland 2013 September , 2013 This document is exclusively for use by Professional Clients and Financial Advisers in Continental Europe and is not for consumer use. Please do not redistribute this document.
  • 2. Table of contents Perspective on Emerging Market Corporate Bonds Invesco overview Invesco investment philosophy and process Portfolio positioning and performance Appendix 2
  • 3. Perspective on Emerging Market Corporate Bonds
  • 4. Year-to-date Index Performance 2013 Emerging Markets Debt versus High Yield, Investment Grade and US Treasuries Global HY: JP Morgan Global High Yield EMBIG Div: JP Morgan Emerging Markets Bond Index Global Diversified EM Sovereign Bond Index GBI-EM Global Div: JP Morgan Government Bond Index- Emerging Markets Global Diversified EM Treasuries Index JULI: JPMorgan US Liquid Index Investment Grade Corporates CEMBI Broad Div: JP Morgan Corporate Emerging Market Bond Index Broad Diversified GBI-US: JP Morgan Government Bond Index US Treasuries Source: JP Morgan, data through September 3, 2013, chart created by Invesco. 4 85 90 95 100 105 110 31.Dez12 07.Jan13 14.Jan13 21.Jan13 28.Jan13 04.Feb13 11.Feb13 18.Feb13 25.Feb13 04.Mrz13 11.Mrz13 18.Mrz13 25.Mrz13 01.Apr13 08.Apr13 15.Apr13 22.Apr13 29.Apr13 06.Mai13 13.Mai13 20.Mai13 27.Mai13 03.Jun13 10.Jun13 17.Jun13 24.Jun13 01.Jul13 08.Jul13 15.Jul13 22.Jul13 29.Jul13 05.Aug13 12.Aug13 19.Aug13 26.Aug13 02.Sep13 Global HY Market Index Value JULI All Cumulative Total Return All EMBIG Div Cum Tot Ret Idx CEMBI Broad Div Cum Tot Ret Idx GBI-EM Global Div Index Total Return Index US $ GBI-US Total Return Index Level US $ Cumulative Total Return 31 Dec 2012 3 Sep 2013
  • 5. What is the Emerging Market Corporate Bond universe? 40% 27% 19% 14% Asia Latin America Mid-East /Africa Europe Source: JPMorgan, as of 30 June 2013, unless otherwise indicated. 6% 6% 6% 6% 6% 5% 6% 5% 5%5% 13% 8% 16% 9% Russia Hong Kong Brazil Mexico Korea China India UAE Qatar Singapore Other Asia Other Europe Other LatAm Other ME/Af EM Indices CEMBI Broad (EM Corporates) US$678 billion EMBI Global (US$ ext): US$554 billion EURO EMBI Global: 66 billion GBI-EM Broad (local): US$1,478 billion EM Total: US$2,796 billion CEMBI Broad Diversified by Country Corporate Indices CEMBI Broad (EM Corporates): US$678 billion Barclays US Aggregate: US$15,345billion Barclays US High Yield US$1,157 billion Barclays US Corporate US$3,561billion 42 Total CountriesAverage Credit Quality: Baa2/BBB CEMBI Broad Diversified by Region 5
  • 6. Emerging Market Corporate Bonds Asset class continues to mature 75 100 125 150 175 200 225 250 275 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Source: Data for CEMBI Broad Diversified Index from JPMorgan, data through 30 June 2013, chart created by Invesco. CEMBI Broad Diversified Index (Cumulative Total Return) Growth of US $100, 31 Dec 2001 30 June 2013 Global Credit Crisis (Fall 08) Refco Bankruptcy filing (Oct 05) Conseco Bankruptcy filing (Dec 02) Global Crossing Bankruptcy filing (Jan 02) WorldCom Bankruptcy filing (Jul 02) Lehman Brothers Bankruptcy filing (Sept 08) WaMu Bankruptcy filing (Sept 08) Gen. Motors Bankruptcy filing (Jun 09) CIT Group Bankruptcy filing (Nov 09) Argentine Devaluation/Default (2002) GrowthofUS$100 6
  • 7. 34.8 33.8 31.0 11.9 44.9 67.0 61.4 125 139.3 26.4 41.8 52.9 28.3 24.1 41.9 34.5 65.5 69.0 23.6 26.7 36.9 9.9 47.7 75.1 77.2 99.9 80.6 13.0 21.5 28.6 7.1 19.9 26.7 29.3 39.0 47.1 0 50 100 150 200 250 300 350 2005 2006 2007 2008 2009 2010 2011 2012 2013F Asia Emerging Europe Latin America Middle East & Africa EM corporate hard currency issuance remains high Diverse regions of issuance 7 Source: JPMorgan, EM Corporate Weekly Analytics, April 2013. F is forecasted values.
  • 8. 100 150 200 250 300 350 400 Apr 10 Jul 10 Okt 10 Jan 11 Apr 11 Jul 11 Okt 11 Jan 12 Apr 12 Jul 12 Okt 12 Jan 13 Apr 13 Jul 13 CEMBI Broad Div IG Subindex JULI (US IG Credit) Spread 84 bps Emerging Market IG corporate still attractive relative to US IG credit Source: Barclays, data through June 30, 2013, chart created by Invesco. 8
  • 9. 7.3% 15.4% 6.3% 0.1% 0.0% 0.2% 0.0% 1.9% 10.7% 1.5% 0.5% 2.7% 2.2% 4.5% 8.1% 3.0% 0.1% 0.0% 0.1% 0.0% 0.7% 3.5% 0.5% 0.1% 0.9% 0.6% 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013F Default rate % HY debt stock Default rate % total debt stock EM corporate default rate history Source: JP Morgan, Emerging Market Corporates Reference Presentation: May 2013 9
  • 10. Invesco overview
  • 11. Explore Intentional Investing with Invesco 11
  • 12. Specialized Fixed Income capabilities delivered globally 12 Data as of June 30, 2013 unless otherwise stated. Dates represent launch of initial product managed in this strategy. Invesco Fixed Income does not include all the fixed income entities within Invesco Ltd., and is not limited to those fixed income assets within the GIPS-compliant firm Invesco Worldwide; therefore, the assets under management reported here for Invesco Fixed Income may not match the fixed income assets reported in the Invesco earnings statement. Invesco Fixed Income US$234.0 billion in AUM 162 investment professionals Operating in eleven cities across five countries Global Liquidity US$79.1 billion in AUM Since 1980 Prime, government and tax-free products Focus on safety and liquidity while seeking to deliver a competitive yield Multiple currencies Broad Fixed Income US$58.6 billion in AUM Since 1977 Core, core plus, intermediate Mortgage-backed securities (MBS)/Asset-backed securities (ABS), investment grade, high yield, emerging markets, municipals and convertibles Global, non-US dollar, European, broad alpha Stable Value US$47.6 billion in AUM Since 1985 Diversified and cost- effective approach using commingled funds Tremendous flexibility a highly customized stable value design with a variety of existing strategies Alternatives US$48.7 billion in AUM Since 1990 Senior secured bank loans Structured securities (bank loans, ABS and credit default swaps) Credit opportunity/Credit arbitrage Real estate investment trust Participant in the Public- Private Investment Program for Legacy Assets North America Asia Europe Australia Atlanta Chicago Houston Louisville New York San Diego Palm Harbor Hong Kong Tokyo London Melbourne
  • 13. Invesco Global High Income investment capabilities 13 *Denotes EM and/or HY team member presence. Team information as of August, 2013. Subject to change without notice. AUM Data as of June 30, 2013 . High Yield Debt 11 dedicated investment professionals Assets under management of US$2.9B Average years of experience 18 years Average years at Invesco 7 years Strategies offered: High Yield, BB-rated High Yield Global High Income Combines the capabilities of Invescos Emerging Market and High Yield teams Assets under management for Global High Income strategy: US$5.3 billion Investment professionals in Asia, UK and US. Emerging Market Debt 5 dedicated investment professionals Assets under management of US$2.4B Average years of experience 18 years Average years at Invesco 7 years Strategies offered: Emerging Market Debt, Emerging Market Local Currency Debt, Emerging Market Corporate Bond London Hong Kong Atlanta
  • 14. Emerging Market Corporate Bonds Invesco philosophy and process
  • 15. Invesco Emerging Market Corporate Bond strategy Investment philosophy and approach Our philosophy: We believe EM corporate debt is a unique and often misunderstood asset class, so we have a dedicated team focusing on total return using a bottom- up fundamental process specifically suited for EM corporate debt. Unlike many peers, we have followed these companies for many years, invested throughout the capital structure, and have seen opera