Thu, Jul 7, 2011 4:31
By Kevin Crowley & Anchalee Worrachate
Europe’s best-performing sovereign debt fund manager over the last decade, Sandor Steverink, correctly predicted Portugal’s downgrade this week and says Ireland will soon follow. Then it’s time to buy, he says.
Steverink, who is co-head of a team managing 26 billion euros ($37.3 billion) at Dutch insurer Delta Lloyd NV (DL), plans to buy Irish bonds once the ratings companies cut the debt to junk as Moody’s Investors Service did with Portugal on July 5. The extra yield investors demand for holding 10-year Portuguese bonds instead of the equivalent German bund surged yesterday to 10.13 percentage points, the most since at least 1997.
“What we’ve learned from emerging markets is that you get only a full recovery after a proper restructuring,” Steverink, 40, said in a telephone interview. “We think that’s necessary for Greece and, in the end, probably for Ireland and Portugal, too. We prefer Ireland above Portugal.”
Holders of Greek debt reaped the best returns of any sovereign-debt market in the two weeks after the government approved austerity policies and secured more European Union aid to pay creditors. Steverink’s Delta Lloyd Instl Obligatie LT fund has returned 5.8 percent a year since 2001, making it Europe’s best-performing euro-denominated government bond fund with more than 500 million euros of assets over the past three, five and 10 years, according to Morningstar Inc. Competitors at Aegon NV and Natixis SA say there are less risky ways to profit from Europe’s sovereign debt crisis.
Greek Rebound
Greek bonds returned 12 percent in a month after Standard & Poor’s slashed the country’s rating three steps to BB+, the top non-investment grade, on April 27, 2010, according to indexes compiled by the European Federation of Financial Analysts Societies and Bloomberg. Greek debt is today rated CCC, the lowest rating of any government in Europe. To read more article visit Bloomberg
By Kevin Crowley & Anchalee Worrachate
Europe’s best-performing sovereign debt fund manager over the last decade, Sandor Steverink, correctly predicted Portugal’s downgrade this week and says Ireland will soon follow. Then it’s time to buy, he says.
Steverink, who is co-head of a team managing 26 billion euros ($37.3 billion) at Dutch insurer Delta Lloyd NV (DL), plans to buy Irish bonds once the ratings companies cut the debt to junk as Moody’s Investors Service did with Portugal on July 5. The extra yield investors demand for holding 10-year Portuguese bonds instead of the equivalent German bund surged yesterday to 10.13 percentage points, the most since at least 1997.
“What we’ve learned from emerging markets is that you get only a full recovery after a proper restructuring,” Steverink, 40, said in a telephone interview. “We think that’s necessary for Greece and, in the end, probably for Ireland and Portugal, too. We prefer Ireland above Portugal.”
Holders of Greek debt reaped the best returns of any sovereign-debt market in the two weeks after the government approved austerity policies and secured more European Union aid to pay creditors. Steverink’s Delta Lloyd Instl Obligatie LT fund has returned 5.8 percent a year since 2001, making it Europe’s best-performing euro-denominated government bond fund with more than 500 million euros of assets over the past three, five and 10 years, according to Morningstar Inc. Competitors at Aegon NV and Natixis SA say there are less risky ways to profit from Europe’s sovereign debt crisis.
Greek Rebound
Greek bonds returned 12 percent in a month after Standard & Poor’s slashed the country’s rating three steps to BB+, the top non-investment grade, on April 27, 2010, according to indexes compiled by the European Federation of Financial Analysts Societies and Bloomberg. Greek debt is today rated CCC, the lowest rating of any government in Europe. To read more article visit Bloomberg
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