Erste Asset Management - Blog

Posts on: Institutional
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Gerhard Winzer am 02nd September 2015

The return of volatility

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Earlier this year the president of the ECB said we would have to get used to elevated levels of volatility. And it is true, the market environment has changed. The years 2009 to 2014 were subject to an asset price reflation regime. High rates of return were coupled with low volatility. This relationship has now reversed. The asset classes are now pricing in the moderate recovery in the industrialised economies, with low expected return amid elevated fluctuation as a rule.
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Gerhard Winzer am 07th August 2015

Emerging countries under pressure

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Commodity prices have fallen drastically since the beginning of July. The commodity price index provided by Bloomberg has fallen by nearly 12%. In fact, many commodity prices are locked in a bear market. The index is currently almost 50% below the level of the beginning of 2011.

Over the same period the currencies of emerging countries have depreciated by about 35% vis-à-vis the US dollar, and equities have fallen by about 26%.

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Paul Severin am 05th August 2015

En|ga|ge|ment – Chief Sustainable Investment Officer Gerold Permoser embarks on an etymological journey

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Being our Chief Sustainable Investment Officer, Gerold Permoser is responsible for all Environmental, Social and Corporate Governance (ESG) investments of Erste Asset Management. In our magazine ERSTE RESPONSIBLE RETURN he tells how a dreaded French exam did not go “perdu”, what Engagement means exactly and why it pays off for companies and investors.

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Gerhard Winzer am 31st July 2015

China weighs heavy on commodity prices and production

Ⓒ ERSTE-SPARINVEST

Global GDP growth has probably only increased marginally in Q2 after the very weak Q1. Economic activity has thus remained disappointingly weak on a global scale.

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Gerhard Winzer am 17th July 2015

Agreement between Iran and the P5+1 countries depresses oil price

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The negotiations between Iran and the UN veto powers plus Germany were concluded successfully on Tuesday, 14 July. Iran will curtail its nuclear programme. In exchange, the international economic sanctions will be reduced.

The result is remarkable in so far as the interests of the P5+1 (the five permanent members of the UN Security Council and Germany) and of Iran differ strongly in many areas. The sanctions apparently had a very serious impact on the Iranian economy, and the P5+1 no longer wanted to hamstring Iran as a political and economic power in the region.

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Gerhard Winzer am 06th July 2015

Parallel currency in Greece?

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Last Sunday, the Greek people decided with a clear majority to follow the proposal of their government. With 61.3%, the No camp rejected the conditions of the expired adjustment program. Thereby, Greece is one step closer to an exit from the Eurozone and the European Union.

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Paul Severin am 03rd July 2015

Social responsibility and transparency: can investors influence companies?

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The bribery scandal at FIFA has shown what huge reputations risks companies may face if they do business with partners that do not care about environmental, social, and corporate governance standards (ESG). The discussion about ESG has therefore gained in importance over the past months. The investors play an important part in this context, as they can themselves nudge companies towards social responsibility and transparency. Gerold Permoser, Chief Investment Officer of Erste Asset Management (EAM) in Vienna explains why the so-called engagement is important.

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Gerhard Winzer am 29th June 2015

Greece – the never ending story

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The breakdown of the negotiations between Greece and its creditors as well as the planned referendum on 5 July troubles capital markets. Greece itself is formally not insolvent. As long that this is not the case the European Central Bank (ECB) will do whatever it takes to contain spillover risks. After the referendum, the next key date will be 20 July, where bonds issued by the ECB will be payable. Until then a number of decisions has to be taken and a new financial package negotiated.

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Peter Szopo am 24th June 2015

Measuring Greek risk

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The longest eleventh hour in recent history is drawing to a close. However, while the negotiations earlier this week seem to have narrowed the gap between Greece and its creditors, a final deal has not emerged yet.

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Gerhard Winzer am 19th June 2015

High noon in Greece and the trend to volatility

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Summary: The economic recovery in the developed economies is supported by the very expansive monetary policies, lower austerity pressure on the government front and among banks, and the fallen oil price. Growth rates remain moderate. In the emerging markets we can see signs of low-level stabilisation at best. The possible default of Greece, excessive interest rate hikes in the USA, a further decline of productivity, and continued economic weakening in the emerging markets are the main risks the markets are faced with.

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