Senior Credit Analyst, Lucror Analytics

Leonard Law, CFA

Senior Credit Analyst

High Yield Experts

Lucror Analytics

Lucror Analytics is a leading credit and ESG research specialist and a provider of technology solutions for differentiated fixed income strategies. Our roots are in bottom-up fundamental credit analysis with a specialization in high yield corporate credits from Europe, Asia and Latin America. We are one of few research specialists integrating ESG considerations with fundamental credit research through a dedicated ESG platform. Our ESG assessment covers five key criteria: Disclosure, E,S, & G Pillars, Controversies, ESG Impact on Credit and ESG Momentum.

Recognizing the importance and value-add of Factor Investing in fixed income, Lucror developed the Smart Quant Navigator (SQN), an intuitive platform that helps clients devise and implement factor-based strategies ranging from pure quant to active fundamental, with integrated ESG.

Our company has been at the forefront of developments in the fixed income markets, identifying opportunities and consistently delivering new products and value-adding solutions to clients. Lucror has close relationships with the largest and most reputable asset managers, family offices, hedge funds, investment and wealth managers globally.

Credit

The Europe HY Trade Book for March 2023 includes high-conviction trade ideas drawn from our European HY coverage universe, along with relative-value scatter plots and tables by industry.

  The Europe HY Trade Book for March 2023 includes high-conviction trade ideas drawn from our European HY coverage universe, along with relative-value scatter plots and tables by industry. 

Europe HY Trade Book - March 2023 - Lucror Analytics

In our European High Yield Investment Outlook, we first discuss our high-conviction trade recommendations. We then examine major geopolitical and macroeconomic drivers for the year, as well as commodity price trends. We also assess the interest rate exposure of companies in our coverage universe and elaborate on developments for European HY markets, including new issuances and defaults. Lastly, we cover sectoral developments and the key drivers for companies under our coverage. Overall, we are cautiously optimistic for 2023, and believe selected names still offer interesting opportunities, albeit spreads have recovered strongly this year.

  In our European High Yield Investment Outlook, we first discuss our high-conviction trade recommendations. We then examine major geopolitical and macroeconomic drivers for the year, as well as commodity price trends. We also assess the interest rate exposure of companies in our coverage universe and elaborate on developments for European HY markets, including new issuances and defaults. Lastly, we cover sectoral developments and the key drivers for companies under our coverage.   Overall, we are cautiously optimistic for 2023, and believe selected names still offer interesting opportunities, albeit spreads have recovered strongly this year.   

European High Yield Investment Outlook 2023 - Lucror Analytics

HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>China's Central Document No.1 emphasizes the need to boost the agricultural industry and improve well-being of the peasants. We see the directions positive for the agricultural sector.</li>
<li>Direct beneficiaries are <a href="https://www.smartkarma.com/entities/sinofert-holdings-ltd" target="_blank" data-smartkarma-citation="entities:893:1" rel="noopener">Sinofert Holdings (297 HK)</a>, <a href="https://www.smartkarma.com/entities/china-xlx-fertiliser-ltd" target="_blank" data-smartkarma-citation="entities:5679:1" rel="noopener">China Xlx Fertiliser (1866 HK)</a>, <a href="https://www.smartkarma.com/entities/first-tractor-co-h" target="_blank" data-smartkarma-citation="entities:12416:1" rel="noopener">First Tractor Co H (38 HK)</a> and <a href="https://www.smartkarma.com/entities/xinjiang-tianye-water-saving-irrigation" target="_blank" data-smartkarma-citation="entities:10975:1" rel="noopener">Xinjiang Tianye Water Saving Irrigation (840 HK)</a>. </li>
<li>Growing rural affluence is positive to <a href="https://www.smartkarma.com/entities/byd-co-ltd-h" target="_blank" data-smartkarma-citation="entities:20962:1" rel="noopener">BYD (1211 HK)</a>, <a href="https://www.smartkarma.com/entities/haier-smart-home-co-ltd-b3ef445f-0f54-4586-8c58-9073de98d60e" target="_blank" data-smartkarma-citation="entities:31105:1" rel="noopener">Haier Smart Home (6690 HK)</a> and <a href="https://www.smartkarma.com/entities/pinduoduo-inc" target="_blank" data-smartkarma-citation="entities:27250:1" rel="noopener">Pinduoduo (PDD US)</a>, while cold chain network buildout is good to <a href="https://www.smartkarma.com/entities/shenzhen-international-holdings-limited" target="_blank" data-smartkarma-citation="entities:9:1" rel="noopener">Shenzhen Intl (152 HK)</a>. </li>
</ul>


China's Central Document No.1 emphasizes the need to boost the agricultural industry and improve well-being of the peasants. We see the directions positive for the agricultural sector.
Direct beneficiaries are Sinofert Holdings (297 HK), China Xlx Fertiliser (1866 HK), First Tractor Co H (38 HK) and Xinjiang Tianye Water Saving Irrigation (840 HK). 
Growing rural affluence is positive to BYD (1211 HK), Haier Smart Home (6690 HK) and Pinduoduo (PDD US), while cold chain network buildout is good to Shenzhen Intl (152 HK). 


China Agricultural Sector: A Read into China Central Document No.1

Lucror Analytics' ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable). We view Bombardier's ESG as "Adequate", in line with the scores for all three pillars. Controversies are "Immaterial" and Disclosure is "Adequate".  We expect the data and our assessment to change going forward, given that Bombardier has become a pure-play business jet provider while the historical data includes the commercial aircraft and transportation segments.

Lucror Analytics' ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable).  We view Bombardier's ESG as "Adequate", in line with the scores for all three pillars. Controversies are "Immaterial" and Disclosure is "Adequate".    We expect the data and our assessment to change going forward, given that Bombardier has become a pure-play business jet provider while the historical data includes the commercial aircraft and transportation segments. 

Bombardier - ESG Report - Lucror Analytics

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>Major breakouts for UK's FTSE 100, STOXX Europe 50, and Germany's DAX (among others) continue to support our belief that non-U.S. equities are likely to outperform in the months/years ahead.</li>
<li>We continue to recommend adding exposure to China/Hong Kong, and to add exposure/remain overweight Europe and the UK; these remain our favorite areas to invest in the year ahead.</li>
<li>The UK/Europe and Hong Kong/China make up the majority of today's individual stock buy recommendations. Industrials, Materials, and Consumer Discretionary Sectors are all bullish and highlighted today -- add exposure.</li>
</ul>


Major breakouts for UK's FTSE 100, STOXX Europe 50, and Germany's DAX (among others) continue to support our belief that non-U.S. equities are likely to outperform in the months/years ahead.
We continue to recommend adding exposure to China/Hong Kong, and to add exposure/remain overweight Europe and the UK; these remain our favorite areas to invest in the year ahead.
The UK/Europe and Hong Kong/China make up the majority of today's individual stock buy recommendations. Industrials, Materials, and Consumer Discretionary Sectors are all bullish and highlighted today -- add exposure.


UK's FTSE 100, STOXX Europe 50 Breaking Out; Non-U.S. Outperformance to Continue, Buys in Cyclicals

Canada

Bombardier Inc. manufactures private jets. The Company focuses on designing, manufacturing, and servicing business jets for multinational corporations, charter and fractional ownership providers, governments, and private individuals. Bombardier serves aviation industries worldwide.

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Bombardier (BBD/A CN)

Europe HY Trade Book - March 2023 - Lucror Analytics

The Europe HY Trade Book for March 2023 includes high-conviction trade ideas drawn from our European HY coverage universe, along with...

Lucror Analytics

European High Yield Investment Outlook 2023 - Lucror Analytics

In our European High Yield Investment Outlook, we first discuss our high-conviction trade recommendations. We then examine major geopolitical and...

Lucror Analytics

China Agricultural Sector: A Read into China Central Document No.1

Directions in China's Central Document No.1 in 2023 are positive for the agricultural sector. We see direct benficiaries being Sinofert, China XLX...

Osbert Tang, CFA

Bombardier - ESG Report - Lucror Analytics

Lucror Analytics' ESG Scores are based on a 3-tiered scale and are adjusted for Controversies (if applicable). We view Bombardier's ESG as...

Lucror Analytics

UK's FTSE 100, STOXX Europe 50 Breaking Out; Non-U.S. Outperformance to Continue, Buys in Cyclicals

Recent major breakouts for the FTSE 100, STOXX Europe 50, and Germany's DAX (among others) continue to support our belief that non-U.S. equities...

Vermilion Research

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