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Nedgroup Inv Euro comment - Dec 11
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Friday, 9 March 2012
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Fund Manager Comment
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The Euro Sovereign Debt Crisis continued to cloud markets in December and with added year-end liquidity issues most risk assets were weaker. European leaders agreed a deal to add €200bn to the IMF for propping up Euro zone countries, the news failed to ease pressures felt by peripheral Euro zone countries.
The ECB cut rates for a second straight month from 1.25% to 1.00% and introduced a new 3 year unlimited LTRO programme at the benchmark rate of 1.00%.
LIBOR rates fell by 10bps across the curve, with the 3 month LIBOR OIS (overnight indexed swap) spread, a measure of banks willingness to lend to each other, making another recent high in December.
The Weighted Average Maturity (WAM) contracted to 18 days at the end of December. We placed new subscriptions into the fund out into the 3-month part of the curve and will look to increase the WAM as and when opportunities arise.
We remain focused on maintaining a high quality portfolio and added 3-month German Government Agency paper to the portfolio.
We remain focused on the short end, providing ample liquidity to investors. While excess liquidity in the market means rates offered by quality issuers are somewhat lower than LIBOR benchmark.
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Nedgroup Inv Euro comment - Sep 11
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Thursday, 22 December 2011
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Fund Manager Comment
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September was very volatile as investors panicked about the fallout from a potential default in Greece. Focus now includes Italy and the French banking system has also come under scrutiny as shares plummeted in the large French banks. Major economies remain at risk of further recession, as growth remains weak. Some degree of calm was restored towards the end of the month as individual countries passed changes to the European Financial Stability Facility (EFSF) and on a potential new plan to substantially increase the size of the EFSF to a reported €2 trillion.
The European Central Bank (ECB) held rates at 1.50%, however as the economic outlook has deteriorated at a rapid pace in the last few months the market is pricing in a possible 50bps rate cut at the October meeting.
LIBOR rates were largely unchanged in September.
In coordination with the Federal Reserve System (Fed), Bank of England (BoE), Bank of Japan (BoJ) and Swiss National Bank (SNB), the ECB announced 3 month USD liquidity operations, providing dollar funding over the year end.
The Weighted Average Maturity (WAM) remained relatively unchanged throughout September, finishing the month at 20 days.
We remain focused on maintaining a high quality portfolio and began reducing exposure to some European bank names while increasing exposure to Government Guaranteed or Government Agency commercial paper.
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Nedgroup Inv Euro comment - Jun 11
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Tuesday, 20 September 2011
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Fund Manager Comment
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The European Debt Crisis intensified again as Greece passed further austerity measures, ensuring the the IMF will disperse the next tranche of funding. While risk traded on and off in-between headlines, Money Markets remained largely unaffected. LIBOR rates rose slightly across the curve as the market anticipates further hikes in the coming months.
The Weighted Average Maturity (WAM) was 17 days at the end of June. We are keeping the WAM short and targeting a WAM within a 30 - 50 day range as further rate increases are expected throughout the year. We rolled some maturities into the 3-month part of the curve as the risk premium for longer maturities has started to offer more value.
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Nedgroup Inv Euro comment - Mar 11
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Wednesday, 25 May 2011
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Fund Manager Comment
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The risk off theme continued in the first half of March with events in Japan and continuing troubles in the Middle East & North Africa. As the situation in Japan stabilised equities moved higher again and government bond yields rose. The European Central Bank (ECB) kept rates on hold at 1%. Hawkish rhetoric from various ECB members along with an inflation print over the 2% target has led the market to fully price in a 25bps rise at the April meeting. LIBOR rates increased significantly across the curve as the first hike is priced into the curve. The Weighted Average Maturity (WAM) was unchanged at 23 days. We are targeting a WAM within a 30 - 50 day range. We placed a portion of the fund in the 3-month area as the risk premium for longer maturities has started to offer more value.
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Nedgroup Inv Euro comment - Dec 10
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Thursday, 24 February 2011
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Fund Manager Comment
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Risk markets performed well in December driven by QE2 and better macro data, however the European sovereign situation weighed on investor sentiment. The European Central Bank (ECB) kept rates on hold at 1%, and decided to increase it's capital base by €5bn to protect it from losses on purchase of EU sovereign debt. Most of the LIBOR curve remained stable but the very short remained volatile. The Weighted Average Maturity (WAM) finished December at 23 days. We are targeting a WAM within a 30 - 50 day range, however, as liquidity remains ample in Euro cash markets there is very little risk premium for increasing duration at this time. The fund remains well positioned to react as and when the yield curve begins to steepen. As Euro-area banks remain well funded and as the ECB continues with it's liquidity operations most quality institutions are not bidding for cash and market rates are somewhat lower than LIBOR. With this in mind the fund may under-perform the benchmark in the short term.
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Nedgroup Inv Euro comment - Sep 10
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Monday, 8 November 2010
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Fund Manager Comment
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Following the risk aversion seen across most asset classes in August, September saw money markets remain calm while equities rallied and government bond yields and gold set new highs. The European Central Bank (ECB) kept rates on hold at 1%, as expected. LIBOR rates spiked sharply at the end of the month as around €90bn of excess liquidity was drained from the system with the expiry of various ECB LTRO's. The Weighted Average Maturity (WAM) finished September at 23 days. We are targeting a WAM within a 30 -50 day range, however, as liquidity remains ample in Euro cash markets there is very little risk premium for increasing duration at this time. The fund remains well positioned to react as and when the yield curve begins to steepen. We added a new FRN paying 95bps over 3-month LIBOR during September. The fund underperformed it's 1-month LIBOR benchmark this month and, whilst this is disappointing, we remain focused on providing adequate liquidity and capital preservation. Although LIBOR rates spiked towards the end of the month, the majority of quality institutions remain well funded meaning deposit rates have not followed LIBOR higher. With this in mind the fund may under-perform the benchmark in the short term.
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Nedgroup Inv Euro comment - Jun 10
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Wednesday, 8 September 2010
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Fund Manager Comment
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Fragile risk appetite impacted across most asset classes as Euro area banking sector stress continued throughout June. The European Central Bank (ECB) kept rates on hold at 1%, as expected. Ahead of the expiry of the ECB's 12 month LTRO, financial institutions borrowed almost €132bn in the ECB's 3 month tender. This was less than the €200 - €250bn expected and taken positively by markets. LIBOR rates continued to increase across the curve with a rise of 2-3 bps in most fixings from 3 to 12 months. The Weighted Average Maturity (WAM) finished June at 18 days. We remain focused on providing adequate liquidity and maintaining the WAM within a 30 - 50 day range, however, as liquidity remains ample in Euro cash markets there is very little risk premium for increasing duration at this time. The fund remains well positioned to react as and when the yield curve begins to steepen. We expect rates to remain low and anticipate that the fund will continue to perform well versus the benchmark in the coming months.
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Nedgroup Inv Euro comment - Mar 10
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Thursday, 24 June 2010
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Fund Manager Comment
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Money Markets remained stable as risk appetite increased across financial markets and equity markets made 18-month highs. Greece remains firmly in focus and a backstop plan involving the EU and the IMF was announced, albeit with little detail at this stage. The European Central Bank (ECB) kept rates on hold at 1%, as expected. ECB President Trichet repeated that there will be a gradual phasing out of liquidity measures. LIBOR rates remained stable but fixings were 2-3 bps lower across the curve. The Weighted Average Maturity (WAM) finished March at 31 days. We remain focused on providing adequate liquidity and maintaining the WAM within a 30 - 50 day range. The fund remains well positioned to react as and when the yield curve begins to steepen. The Manager expects rates to remain low and anticipates that the fund will continue to perform well versus the benchmark in the coming months.
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Nedgroup Inv Euro comment - Dec 09
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Tuesday, 23 March 2010
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Fund Manager Comment
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Money Markets remained calm throughout December.
The European Central Bank (ECB) held policy rates at 1%. In line with the previous statement the ECB became the first major central bank to actively remove some of its unconventional measures by announcing that the 1yr LTRO in December would be the last. The ECB also applied a floating rate to the tender rather than a fixed 1% in a bid to deter banks from borrowing from the ECB.
The Weighted Average Maturity (WAM) finished December at 54 days. We have added a little duration through high quality FRN's in the new issue market and continue to look for opportunities when opportunities arise.
The fund once again outperformed it's one-month LIBID benchmark. As rates remain low we anticipate that the fund will continue to perform well versus it's benchmark in the coming months
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Nedgroup Inv Euro comment - Sep 09
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Wednesday, 9 December 2009
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Fund Manager Comment
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Money Markets extended their period of calm through September. The European Central Bank (ECB) held the key repo rate at 1.00% and reiterated their belief that the current rates remain appropriate. LIBOR spreads continue to narrow reaching pre Lehman levels. The weighted Average Maturity (WAM) finished August at 34.15 days. We continue to feel comfortable running the WAM at this level. The fund once again outperformed its one-month LIBOR benchmark. We are pleased that the fund has held up so well vs. its falling benchmark and anticipate that the out performance will remain elevated in the coming months.
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Nedgroup Inv Euro comment - Jun 09
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Wednesday, 16 September 2009
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Fund Manager Comment
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Market conditions continued to improve, the equity rally paused for breath but credit performed strongly.
The European Central Bank (ECB) held rates at 1.00% as expected, leaving room for another cut if economic conditions warrant it.
LIBOR rates continued to fall in line with official rates, the ECB began it's first ever 12 month refinancing operation - lending €442bn to euro-zone banks at the current benchmark rate of 1%. As a result LIBOR rates fell to record lows as the system became awash with liquidity.
The Weighted Average Maturity (WAM) finished the month at 54.67 days. As we expect rates to remain low over the coming months we will continue to monitor the WAM.
The fund marginally outperformed the one-month LIBOR benchmark, with the fund benefitting from elevated money market rates compared to lower official rates. As interest rates remain low we expect the fund will continue to offer very competitive returns whilst outperforming the benchmark.
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Nedgroup Inv Euro comment - Mar 09
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Tuesday, 9 June 2009
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Fund Manager Comment
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Market conditions improved during March as equities rallied, recovering some of the last 12 months losses and credit spreads tightened.
The European Central Bank (ECB) reduced interest rates by 50bps to 1.50%. The accompanying statement indicated that the ECB are also considering possible non-standard measures and that rates could be reduced further.
LIBOR rates continued to fall in line with official rates, with the short end falling sharply.
The Weighted Average Maturity at month end was 50.15 days after peaking at 61 days earlier in March. With rates expected to fall further we are targeting a WAM of 75 days over the coming months.
The fund outperformed the one-month LIBOR benchmark by 0.08%, with the fund benefiting from elevated money market rates compared to lower official rates. As interest rates continue to fall we expect the fund will continue to offer very competitive returns whilst outperforming the benchmark.
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Nedgroup Inv Euro comment - Dec 08
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Monday, 30 March 2009
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Fund Manager Comment
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Manager commentary
Rob Brockbanks, Treasury Manager - Thomas Miller Investment (Isle of Man) Limited
Market conditions calmed a little during December as investors placed money over the turn of the year and prepared for the Christmas break.
The European Central Bank (ECB) reduced rates by 75bps to 2.50%. Receding inflationary pressures have allowed the ECB to cut rates aggressively in a bid to stimulate the deteriorating economy.
LIBOR rates continued to fall in line with official rates.
The Weighted Average Maturity (WAM) of the TMI Euro sub-fund fell to just below 60 days as we remain focused on liquidity and capital preservation while investing in short-dated high quality names.
The TMI Euro sub-fund outperformed the one-month LIBID benchmark, the fund benefiting from elevated money market rates compared to lower official rates. As interest rates continue to fall we expect the fund will continue to offer very competitive returns whilst outperforming the benchmark.
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Fund renamed
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Tuesday, 30 December 2008
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Official Announcement
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The Nedgroup Investments Euro Money Market Fund has been renamed to the Nedgroup Investments Euro Fund.
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Fund renamed
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Wednesday, 5 December 2007
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Official Announcement
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The Nedgroup International Investor Series Euro Money Market fund has been renamed to Nedgoup Investments Euro Money Market Fund.
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