Adjusting to a World of Surplus Crude
The arrival and subsequent exploitation of U.S. shale has disrupted oil market equilibrium, ushering in a period of global oil abundance. With this, the unique production characteristics of shale, most notably the shorter-cycle nature of shale output and continued improvement in drilling productivity, have profound implications for global oil markets.
Many asset managers today advocate that plan sponsors consider a risk reduction strategy called "hibernation". But just as glidepaths don't always "glide", hibernation is not a passive strategy, but one that needs to be carefully watched. In this paper, we consider how the interplay between a smarter hibernation strategy and different de-risking tools can allow a plan to slowly wind down. (March 2015)
The European Central Bank's (ECB) announcement appears largely designed to further weaken the euro. The ECB aims to add €1.1 trillion in assets, and possibly more, thereby returning the balance sheet to its 2012 high. The program could well be extended, should inflation fail to rise towards the de facto 2% target. (January 2015)
Prudential Fixed Income to manage new $666.5 million CLO, September 3, 2014Read More