Long-term US Treasuries are seen as a necessary place to hide by many investors seeking to ride out market volatility.
The fixed income specialist's CEO James Hirschmann says he would welcome a rising interest rate environment. He also predicts where the biggest fixed-income flows will be heading and speaks out on Pimco.
The fund house is moving to register two corporate bond funds and a more unusual product in Hong Kong. Legg Mason affiliate Western Asset is also overweight China, bucking a recent trend.
The US fund house’s chief executive, Joseph Sullivan, spoke to AsianInvestor about his global ambitions for the firm, with a focus on Asia, most notably China.
A US default seems not to have been priced in by Asian investors, despite the current government shutdown. Whatever else happens, QE tapering seems likely to be postponed.
The firm will soon roll out a Dublin-domiciled Asian fixed income product. It also expects more Japanese money to flow offshore and sees Philippine bonds as particularly attractive now.
They see it as a natural progression, although timing remains uncertain, after China's central bank moves to curb speculation by proposing the next step to full convertibility.
Asian fixed income has hit record levels of foreign ownership, but stickier offshore investors should preclude a 1997-style crash, says Western Asset's Lian Chia-Liang.
The US bond manager has almost finished replacing and expanding its Singapore-based unit of portfolio managers and analysts.
Western Asset debates the durability of the recent shift in power from rich industrialised countries to emerging markets.
Investors are captivated by fear of default contagion, driving market liquidity to determine sovereign solvency. This is wrong, but there is reason for optimism, says Western Asset.
Western Asset has hired Lian Chia-Liang to head its Asian fixed-income investment team in Singapore.