< The 2014 All-Europe Fixed-Income Research Team

Barnaby Martin & team
Bank of America Merrill Lynch
First-place appearances: 0

Total appearances: 2

Team debut: 2013

After debuting last year at runner-up, Bank of America Merrill Lynch steps up to third place, under the sole guidance this year of London-based Barnaby Martin, whose two-member team also seizes the No. 3 position in Investment-Grade Strategy as well as a runner-up spot in High-Yield Strategy. “We believe the high-liquidity, low-growth environment will persist in Europe in 2014,” reports Martin, with output increasing at a conservative 0.8 percent. This will encourage investors to seek better yield alternatives in the region’s credit markets, particularly the high-yield segment, he adds. However, a key concern this year will be the European Central Bank’s reaction to the threats of disinflation and deflation. Sovereign debt dynamics could deteriorate, especially in the peripheral nations, Martin explains, if disinflation holds. Given this uncertainty, his BofA Merrill strategists anticipate that noncore financials will offer greater upside than their core counterparts. In addition, since high-beta credit is attractive in low-growth markets where spreads are compressing, the group recommends overweighting bank contingent convertibles and corporate hybrid bonds. Barnaby is “very knowledgeable in discussing single-name ideas,” one client reports, “which is a real means of adding value for buy-side managers.”