HALISTER1: Invesco Exits Greek Bonds, Finds EU Credit Valuation Alluring

Invesco Exits Greek Bonds, Finds EU Credit Valuation Alluring

(Bloomberg) -- Invesco boosts holdings of credit after cutting exposure to peripheries by getting rid of Greek goverment bonds, portfolio manager Lyndon Man says in interview.
  • Sees opportunities in credit, given ECB’s QE program, and CPI and GDP environment, London-based Man says in interview; runs very low risk in sovereign and fx space
  • Prefers to buy financial, subordinated debts, HY in relative value terms and sees value in any credit assets that ECB is not buying
  • Liquidity in European credit market remains ample compared with peripheral bonds market
  • The spread premium in periphery bonds, especially for countries like Greece, Cyprus, don’t compensate investors for risk
  • Invesco still believes in peripheral convergence theme but valuations are less attractive now
  • Among peripherals, prefers Italy against core countries such as Germany, France, Netherlands
  • Fund is underweight Spain as sees risk heading into the elections in June; holds some long positions through options as country’s fundamentals remain solid
  • In FX space, Invesco is long sterling against a basket of currency including euro, as expects U.K. to vote to stay at June referendum
  • NOTE: Man manages Invesco Euro Bond Fund, which had about EU800m in assets under management as of end of March; Invesco Euro Bond Fund is part of Invesco, which managed $771.5b at the end of March, Lyndon says
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

Tickers
2539Z GR (European Central Bank)
1004Z GA (Hellenic Republic)

People
Lyndon Man (Invesco Ltd)

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