< The 2016 All-Asia Research Team

Total appearances: 12

Team debut: 1997

Extending their run in second place to a third year, Michele Barlow and her associates in Hong Kong impress one fund manager as “an excellent team, with extensive coverage in my issuer universe.” The Bank of America Merrill Lynch researchers see improving investment options in regional credits for the balance of this year, says Barlow, as “risk appetite appears to have returned.” Compared with other emerging markets, she notes, Asia now represents a safe haven, where government support in the sector provides “a more stable ratings migration trend.” As a result, although the squad foresees ongoing market turbulence, “spreads for investment grade can still grind modestly tighter,” she reports, given that commodities prices have stabilized, global central banks are again easing — “fueling a yield-seeking attitude” — and macro risks from China’s weak growth have abated. Moreover, because of lower supply, high investor cash balances and a positive turnaround in fund flows, the strategist reports, “technicals are strong,” and Asian spreads are “back to pre-sell-off levels.” Single-A instruments offer the best value, Barlow adds. For countrywide corporates, the analysts advise overweighting China; holding a market weight position on Hong Kong, Indonesia, Malaysia and Singapore; and underweighting all other countries in the region. “We suggest staying up the credit curve in double-Bs while being very selective in Bs for yield,” she says. “Overall our bias favors a focus on quality and risk management.”