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Publications

LA Forum publications provide a comprehensive overview of the end to end research and investment process across a range of asset classes.  Our aim is to help our members understand complex problems and plan efficiently.

Written and published for Local Authority officers, these thought provoking documents highlight investment issues, available options and trends in key areas of the UK's public sector pension scheme space.

Targeting investment officers, policy makers, industry specialists, and the pensions board in order to promote debate and understanding.  It is not intended for use directly in either market forecasting or for investment decision purposes, where specialist advice should be sought.

Please note: some of the media sources, publications or articles featured on LA Forum may require registration to gain access.

Interested parties should contact Mark Turnbull (Director: LA Forum) T: 01260 226610 E: mark@laforum.co.uk

Legg Mason - Another arrow in the quiver: Diversifying income with REITs

The scarcity of yield that continues to challenge investors has driven many toward new sources of income. Equity investments such as dividend-paying stocks and master limited partnerships1 have attracted significant inflows despite a generally tepid economic environment.

Date added: 11-12-2015

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Legg Mason - Another arrow in the quiver: Diversifying income with REITs

Legg Mason - Low oil prices, low interest rates — A shift in perceptions

Our last letter discussed the possibility of a minor rise in interest rates. We concluded that it was hardly worth worrying about, because any lift would be small and gradual. The market had plenty of other things to worry about and rates seemed low on the list. We suggested that near zero rates were having an impact counter to the original intent of the Federal Reserve (Fed).1 The necessary zero interest rate policy of 2008–2013 was now harming savers and pension funds, both of which needed much higher returns to avoid financial stress. The ultra-low rates have affected spending by individuals and have created fiscal problems for municipalities trying to meet pension obligations. There are also warnings about bubbles in art and real estate because of the ultra-low rates, which made leveraged borrowing too easy.

Date added: 11-12-2015

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Legg Mason - Low oil prices, low interest rates — A shift in perceptions

Legg Mason - European equities; Gaining traction?

European equities have lagged those in the US, amid delayed monetary policy reaction to the financial crisis and the impact of Greece’s debt problems on confidence in the European Union.

Date added: 11-12-2015

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Legg Mason - European equities; Gaining traction?

Legg Mason - Pricing pressures and global high yield

Credit investors in developed and emerging markets (EM) have been trying to understand the rapid decline in credit and foreign currency valuations. The reasons for these valuation declines have been pinned on weak commodity prices and institutional structures in EM, lack of inflation and impotent monetary policy in developed markets, the ever present concern of lower growth emanating from China, and a broader EM malaise based on EM central banks facing a classic, but treacherous dilemma of having to keep policy tight in the face of slowdowns to avoid currency instability.

Date added: 11-12-2015

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Legg Mason - Pricing pressures and global high yield

Legg Mason - Spread sectors rally; but risks remain, No easy answers

Fixed-income markets have gyrated wildly this year, constantly shifting from pessimism to optimism and back. Early in the year, plunging oil prices and fears of European recession pushed German bund3 rates to near 0%, while 10-year US Treasury yields hit 1.6%. Then optimism returned with the spring, as growth sentiment about the US and Europe improved, oil prices stabilized in the $60s, stock prices rebounded and so did bond yields. During the summer, expectations of global growth dropped sharply, driven by fears of a pronounced slowdown in China, and knock-on fears for the emerging market (EM)4 sector as a whole. All this led to the most brutal performance for spread sectors5 since the euro crisis of 2011.

Date added: 11-12-2015

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Legg Mason - Spread sectors rally; but risks remain, No easy answers

Legg Mason - Why global bonds?

Global bonds are a unique “opportunity class” that can produce superior returns, provide diverse sources of alpha,1 and reduce the overall volatility of a purely domestic bond portfolio. We believe active global bond investors may have an intrinsic advantage due to an expanded opportunity set. Investors who focus on government bonds in a single country are limited largely to binary duration2 decisions, while global managers who have the skill to manage currencies can capture much more complex relationships. In allowing managers to invest globally, investors diversify their source of return and, in our view, allow greater potential for outperformance, in our opinion.

Date added: 11-12-2015

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Legg Mason - Why global bonds?

Legg Mason - Drilling down: The impact of low oil prices

A year ago, the oil price was in freefall. Brent crude prices had spent much of the first half of 2014 at around U.S.$100 per barrel, but by November 2014, the oil price had started to plummet. Twelve months on, and with the oil price now halved, the slump shows no sign of ending.

Date added: 11-12-2015

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Legg Mason - Drilling down: The impact of low oil prices

Legg Mason - Global bond review and outlook: European bonds rise on QE expectations

Policy accommodation from central banks around the world will continue to underpin growth given global inflationary pressures that remain very subdued and show little sign of increasing. The decline in commodity prices should support global growth by increasing real consumer incomes and corporate earnings in the medium term.

Date added: 11-12-2015

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Legg Mason - Global bond review and outlook: European bonds rise on QE expectations

Legg Mason - Emerging market equities: Looking to the long term

Cyclical downturn, not structural decline.  It’s been a torrid time for investors in emerging markets,1 who have seen 18% shaved off the MSCI Emerging Market Index2 over the last six months. At the eye of the storm has been China, where faltering economic growth has been compounded by stock market routs. In August, Shanghai’s benchmark index3 fell by 8.5% in a single session, prompting Chinese policymakers to undertake a spate of interest-rate cuts to bolster the flagging economy. For its emerging market peers, China’s decision to allow the yuan4 to devalue over three days was especially significant, and watched with consternation. The move led to fears of competitive devaluations across Asia and broader emerging markets, an unwelcome development to exporters already feeling the pinch of falling commodity prices.

Date added: 11-12-2015

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Legg Mason - Emerging market equities: Looking to the long term

Legg Mason - Balancing income and volatility, a dividend centric approach

Gone are the days when investors could satisfy their income needs with low-risk investments, like government bonds. The extraordinary intervention by central banks in the aftermath of the financial crisis has left behind an ultra-low rate environment, making it more difficult to meet income needs.

Date added: 11-12-2015

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Legg Mason - Balancing income and volatility, a dividend centric approach

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