Are Capital Markets Ready to Stabilize? Credit Suisse's Asset Management Division Tackles this Question in its Q3 2012 Alternatives Quarterly

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Aug 07, 2012, 01:56 ET

NEW YORK, Aug. 7, 2012 /PRNewswire/ -- Credit Suisse's Asset Management division today announced the release of the third quarter 2012 edition of its Alternatives Quarterly. This publication, accompanied by a short video, offers insights from the Asset Management division's Global CIO Office and leading alternatives portfolio managers on global economic trends and capital markets.

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In this edition, Stefan Keitel, Global Chief Investment Officer for Asset Management and Private Banking, discusses the continued ebb and flow of risk appetite in global markets and tackles a key question many investors are asking: Are capital markets ready to stabilize?

Mr. Keitel expects markets to stay volatile, but gradually stabilize in the latter part of this year. He believes that "sluggish global growth and Eurozone concerns will continue to weigh on investor sentiment, but these worries have, to a visible extent, already been priced into the markets. Additionally, we see the outcomes of the June European Union (EU) summit and Mario Draghi's recent statements as positive steps that confirm the willingness for necessary policy action in the region." Other key topics in the Q3 2012 issue include:

Long/short hedge fund managers are finding attractive investment opportunities, amidst higher dispersion among stocks while relative-value managers were positioned defensively given the uncertainty in current markets.
Our Credit Suisse event-driven hedge fund replication model continues to show significant exposure to high-yield bonds. This suggests that, as interest rates remain at all-time lows and global macroeconomic concerns continue to suppress equity markets, hedge funds are turning to high-yield bonds in an attempt to generate some level of yield.
According to the Credit Investment Group, senior loans continue to present attractive relative value compared to other fixed income sectors. CLO issuance has been a significant driver of demand with new deal issuance remaining at elevated levels.
The Commodities Group believes that the key driver of commodity prices later this year will ultimately be global growth. While they continue to hold the view that global GDP growth will be stronger in the second half of the year than the first, the ongoing downswing in cyclical momentum is becoming more concerning and should be closely monitored.
Within securitized products, our managers project that the non-agency residential-mortgage backed security market will continue to offer attractive returns in the third quarter, supported by positive US housing data and increasing appetite for the asset class.

For a copy of the Q3 2012 Asset Management Alternatives Quarterly or to view the video, please contact [email protected].

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Asset Management
In its Asset Management business, Credit Suisse offers products across a broad spectrum of investment classes, including hedge funds, credit, index, real estate, commodities and private equity products, as well as multi-asset class solutions, which include equities and fixed income products. Credit Suisse's Asset Management business manages portfolios, mutual funds and other investment vehicles for a broad spectrum of clients ranging from governments, institutions and corporations to private individuals. With offices focused on asset management in 19 countries, Credit Suisse's Asset Management business is operated as a globally integrated network to deliver the bank's best investment ideas and capabilities to clients around the world.

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SOURCE Credit Suisse AG