Joyce Chang & team J.P. Morgan
The buy side says: “Her insights into emerging markets are nothing short of profound.”
Joyce Chang drives J.P. Morgan’s four-person team to the winner’s circle for a second straight year. “I’ve yet to ask a question that she couldn’t answer,” marvels one portfolio manager, while another insists that the 47-year-old leader is “in a class by herself.” In August 2011, Chang and her associates urged clients to overweight Venezuela’s sovereign debt on the strength of its high yield (then at 12.5 percent) and low default risk, among other factors. By mid-July Venezuela has delivered a total return of 19.7 percent — well ahead of the J.P. Morgan global emerging-markets bond index’s 10 percent gain over the same period. In January the strategists recommended overweighting the dollar-denominated government bonds of the Dominican Republic. In mid-May, when they reduced their rating to neutral, the bonds had delivered a total return of 9.8 percent, 4.7 percentage points ahead of the index. “We also timed well the exposure to Belize, which sold off amid restructuring risks,” Chang notes. The researchers advised overweighting the bonds in early March and they have since returned 8.3 percent — 3 percentage points ahead of the index — through mid-July. The crew continues to recommend overweighting Latin American sovereign debt relative to emerging markets in Asia, Europe, the Middle East and Africa because “it is the region most removed from the European woes, most countries have a lot of policy flexibility, and net financing needs remain negative,” she says. — Thomas W. Johnson