According to the results of a recent survey, fixed-income investors want more ESG data than what is currently available. A survey of 111 senior buy-side fixed-income investors, which was conducted by analytics firm Coalition Greenwich, found that 90% believe ESG is important to decision-making, but only a third have fully integrated ESG into their risk analysis. The reason for the large difference is a lack of ESG data. Coalition Greenwich’s senior analyst Stephen Bruel stated “It boils down to risk management. If you don’t have reliable ESG data about an issuer or issuance, then it’s harder to calculate what the negative consequences might be.” More than half of the respondents said it was “important to incorporate ESG in fixed-income portfolios to perpetuate corporate values,” but there’s a “gap between where the survey participants want the industry to be and where it actually is.” Data was listed as the largest obstacle to achieving these ESG goals. The concerns about ESG data quality included greenwashing and inconsistent ratings. Essentially, if the data isn’t reliable, then quantifying risk becomes harder, which could open up investors to sizeable losses. This is especially true with the calculation of climate risk, which would certainly benefit from more data.

Finsum: Based on the results of a recent survey, fixed-income professionals believe ESG is important, but a lack of data is preventing more of them from implementing an ESG strategy.

The energy sector has been the top-performing sector so far this year, but it may be time to sell. That is according to JPMorgan's Marko Kolanovic. Kolanovic, who is JPMorgan’s chief global markets strategist, recommends that investors sell out of energy stocks to capitalize on the performance divergence between oil and energy stocks. Oil prices surged more than 72% at the beginning of the Russia-Ukraine war, but have since plunged almost 50% and are now down for the year. The decline in WTI and Brent Crude Oil can be seen at the pump as the average price for a gallon of gas in the U.S. fell to $3.32 on Friday after previously hitting $5 earlier in the year. However, as oil prices have fallen, oil stocks are still trading near their multi-year highs. Historically, oil prices and energy stocks have been highly correlated, but the large difference this year and a broad pullback in the equity market could result in a selloff in energy stocks. Kolanovic believes that investors could take advantage of this by selling energy stocks now and then buying them at a lower price before the next upswing.

Finsum:JPMorgan strategist recommends selling energy stocks now before a major pullback that could be driven by the divergence between falling oil prices and rising energy stocks.

You go, ETFs. More and more, they’re a key component in the evolving fixed income terrain, according to insuranceaum.com. That tidbit surfaced in a survey of 700 institutional investors and investment decision makers.

The download on ETFs: 

• Being leveraged for portfolio construction – and that includes non-core allocations
• Playing a liquidity role as investors step up allocations to non-liquid sources of income
• Helping to facilitate the internalization of fixed income management
• Enabling investors to implement, with precision, ESG objectives

Meantime, the New York Stock Exchange’s not only about the peaks and valleys of the market.

And, hey, who doesn’t need a respite from that maddening merry go round?

Assets under management in fixed income ETFs swelled from $574 billion in 2017 to $1.28 trillion last year, according to data recorded by the exchange, reported ssga.com. Wait, there’s more: during the same timeframe, the number of funds leaped from 278 to almost 500.

Jump starting the juices on current income is the primary intent of ETF’s, according to entrepreneur.com. The story appeared originally in Stock News. Capital appreciation’s a secondary objective. The fund’s hopping, too, with $4.78 billion in assets under management, not to mention 1307 holdings.

Someone: please pass the Tylenol. Come to think of it, you might want to pop one yourself.  

Either way, fixed income investors thank you.

After all, their mantra this year…waiting…waiting…“pain to gain,” according to advisorperspective.com.

Feel free to dry swallow the thing.

Anyway, precedent making losses are making their mark in traditional fixed income benchmarks, opening the door to an environment that’s done anything but double clutch when it comes to investment grade, core fixed income dispensing yields in the mid single digits. 

And talk about bitter cocktails. The drop off in fixed income coupled with the turn south in equities has culminated in questions among investors associated with their bond portfolio. Down the road, what – if any – benefit bonds can yield.

In fact, fixed income’s enduring its nastiest year in a generation, according to investmentweek/co/uk. At the core of the sell off; ta da – the global government bond market.  

Now, with opportunities sneaking over the horizon, investors have a strategy for approaching the asset class, they told Investment Week.  

The mother lode of sweeps? And, nope, Mr. Bond, it’s nothing quite as clandestine as an undercover patting down of a room for listening devices.

Overactive imagination much, James?

According to fa-mag.com, there’s a gargantuan sweep of multiple states of broker dealers to gain a sense of just how effective their Regulation Best Interest implementation will be completed early next year. 

Last November, violations and, rampant, at that -- centering around retail advice and sales – reared themselves through similar multi state exams, which encompassed 443 firms, the site continued. That was despite the fact that, for more than 15 months, by then, Reg Bi had been in place.

Meantime, someone say “grace period?”

--Yes, indeed, and quite succinctly at that. And the one that pulled up to the station in the aftermath of Reg Bi’s implementation date wound to its conclusion with financial firms starting to face the first round of enforcement actions from regulators under Reg BI, according to stradley.com.

--Reg Bi was earmarked a priority by the Securities and Exchange Commission. What does that mean for firms? Well, it’s incumbent upon them to have in place the right people, processes and technology in place so they’re still in compliance.