Go Banking Rates reported rising prices “are not fading away as quickly as the optimists had hoped — inflation, it seems, is here to stay.” While the short-term inflation “that’s causing sticker shock at the grocery store and the used car lot grabs all the headlines,” creeping price increases “that are just now on the horizon might present the bigger danger.” However, Voya Investment Management Head of Multi-Asset Design Amit Sinha said, “I worry more about non-pandemic-related inflation in retirement such as rising healthcare costs rather than short-term pandemic-related inflation.” Sinha added, “Typically, areas of the economy that face less competition tend to have greater sustained inflation. For retirees, this is likely to be healthcare. The only way to prepare in my opinion would be to make sure you have sufficient savings for sustained increases in these types of expenses. Using health saving accounts (HSAs) may be a way to achieve this.”
In an opinion piece for Financial Advisor Magazine Voya Investment Management CEO Christine Hurtsellers writes that over her “career in money management in several organizations — both public and private — I’ve seen the difference that a strong, innovative culture can provide — not only in terms of generating investment returns, but also for our firm’s employees.” Hurtsellers notes that despite how much has been “written over the years about the benefits of a diverse workforce ... the financial services industry still lags behind,” with, for example, Morningstar showing “that in the U.S., only one in 10 funds were led by a female portfolio manager.” This must change, Hurtsellers says, “especially if we want to adapt to evolving client needs and to truly deliver solutions that reflect the benefits of diverse thinking.” Hurtsellers adds, “if our industry is to thrive, everyone from the C-suite, to the fund managers to the support teams needs to adapt. Those that do will create great cultures that enable success for employees, shareholders and clients.”
In an interview with columnist Barry Ritholtz for Bloomberg Opinion’s Masters in Business podcast, posted to Ritholtz’s The Big Picture blog, Voya Investment Management CEO Christine Hurtsellers discussed “how her firm managed its way through the pandemic: The challenge was keeping employees engaged and mentally healthy even as they were feeling detached during the entire year.” Hurtsellers also discussed how her “prior experience as a bond fund manager — she was CIO of Fixed Income at Voya, managed the $650 billion retained portfolio of GSE wraps at Freddie Mac, and PM for securitized assets at Alliance Capital Management — affected her outlook on equities, elevating the preservation of capital as a key part of her investment philosophy.” Hurtsellers also explained “how raising five children, including one on the autism spectrum, has given her insights into the challenges for working mothers.”
In a multi-segment appearance on Bloomberg TV, Voya Investment Management Managing Director and Head of Asset Allocation Barbara Reinhard said since the Federal Reserve’s most recent meeting, “bond yields peaked, and equity started to struggle,” which has “been a realization, and incorporating new information from the Fed that they are going to count this current surge in inflation towards their long-term goal of meeting two percent. And the change in that is that the markets are pulling towards the expectations that the Fed will start hiking rates into 2022.” Asked about a downside threshold for bond yields where she might become “a little bit more concerned,” Reinhard said, “when bond yields get down that low, they don’t become quite as an effective hedge against Treasurys, and that is very concerning, especially for people that are asset allocators. And unfortunately, if they go up too high, it starts to scuttle some parts of the more cyclical avenues in the market, such as homebuilders and cyclicals.”
Kiplinger reported the expectations-beating jobs report “was Wall Street’s central focus Friday, and the driving force behind new record highs in all three of the major stock indexes,” after the Labor Department reported 850,000 jobs created in June, beating analysts’ expectations of 720,000. This reaction came despite the unemployment rate, “which ticked higher to 5.9%, from 5.8% in May, and exceeded the 5.6% figure economists were looking for.” Voya Investment Management Head of Multi-Asset Design Amit Sinha called the report “effectively a goldilocks report for both the economy and markets,” adding, “It validates the growth story while reducing fears of the Fed taking away the punch bowl anytime soon.”
A press release carried in Business Wire reports Centaurus Renewable Energy, developer “of the Arroyo Solar & Storage Project in McKinley County, New Mexico, announced today that it has closed a $70 million construction bridge loan facility provided by Voya Investment Management, the asset management business of Voya Financial.” The credit facility “will be used to make payments for project equipment and for other development and construction expenses.” Voya Investment Management’s Direct Infrastructure team, led by Tom Emmons and Ed Levin, organized the transaction.
In an appearance on Bloomberg TV’s Bloomberg Markets: The Close, Voya Investment Management Fixed Income CIO Matt Toms discussed the debate over when a tightening of Federal Reserve policy is likely to begin. Toms said the Fed is “trying to keep the optionality to taper before December ... and they’re going to go into Jackson Hole and debate, is a September announcement likely to get going?” Toms said the “big debate is do you start in October after a September announcement, or do you wait for the new year?” Regarding the recent bond market turmoil, Toms said there was “a whole rate cycle in the month of June, to where Fed rate hikes or the talk of taper caused a selloff, and then the immediate feedback is, oh dear, what if they do begin to become less dovish?” As a result, Toms said fixed-income markets “begin to already price in the what-if scenario once they start to move.” Toms said that means the “very long end of the bond market” is unlikely to move out of the 1.5-2% range on the 10-year Treasury bond, “and that’s ultimately a really good predictor of the terminal Fed funds rate, one-fifty to two percent.”
MarketWatch reported that as more Americans emerge from lockdowns, and those in the West seek to escape extreme heat, “the appeal of going anywhere, even ‘nowhere special,’ has deepened.” However, skepticism remains about “gathering in a movie theater with strangers,” and commercial property bond investors “weren’t always thrilled about the big, boxy setup of these buildings even before the pandemic hit.” Voya Investment Management Head of Securitized Investments Dave Goodson said in an interview, “We didn’t like movie theaters, generally to speak of, even pre-COVID,” adding “that upkeep can be expensive, even before thinking about what retrofits might be needed to attract another kind of tenant if a theater chain goes out of business.” Goodson said, “Uncertainty around the space, that’s been accelerated with COVID. It forces us to be more cautious.”
Voya Investment Management announces first close of new infrastructure debt fund focused on renewable energy project financing
Voya Investment Management (Voya IM) announced today that its private credit platform completed the first close of a new infrastructure debt fund focused on project financing in the renewable energy space. With over $300 million in commitments, the first close comes on the heels of Voya IM’s hiring of Tom Emmons and Edward Levin, co-heads of Voya IM’s direct infrastructure team responsible for the origination, underwriting, structuring and management of mezzanine and stretch senior opportunities in renewable energy infrastructure projects.
Ignites reports, “The old days of sales teams determining who handles each advisor based on where the client lives and the size of its portfolio are over, distribution executives say.” Voya Investment Management Head of Distribution Enablement and Intelligence Jane Conway said the rapid shift to hybrid sales and digital engagement has accelerated changes in how sales teams cover advisors. According to Conway, that “means moving away from traditional coverage models based on ‘zoning’ that mapped out how wholesalers could most efficiently visit clients in a territory.” Conway said, “In our new ways of working, we wonder if zoning is even important. What Covid has taught us is to be innovative in the way that we engage with clients.”