PASADENA, Calif., Jan. 22, 2015 /PRNewswire/ -- Ken Leech, Chief Investment Officer of Western Asset, said that viewing fixed-income markets through a global lens was the key to understanding the puzzle in 2014 and will be equally important in 2015. Recently Ken Leech, Carl Eichstaedt and Mark Lindbloom were jointly named Morningstar's 2014 U.S. Fixed-Income Fund Manager of the Year for the Western Asset Core Plus and Western Asset Core Bond funds.
Many investors had expected interest rates to rise in 2014 after the U.S. Federal Reserve ended quantitative easing, and were surprised when rates declined sharply in the first half of the year, and moved lower late in the year. Mr. Leech noted that while the U.S. Economy performed well, challenges in Europe, a slowdown in China and weakness in commodity pricing brought a decline in interest rates around the world.
In a video entitled "The Global Economy 2015: Dramatic Differences", Western Asset states its belief that the global outlook in 2015 will be "a picture of dramatic differences" and that it is watching the following trends:
The inflation picture continues to suggest a muted backdrop, which will support fixed-income yields, and may delay interest rate hikes until later in 2015
To address soft growth in Europe, policy will be very proactive, and the ECB will need to initiate a quantitative easing program in which they buy sovereign debt
The slowdown in China, continued weakness in Japan and weak commodity prices will be a drag on emerging markets to varying degrees
In the U.S., the Fed will continue to look to end emergency policies. They would like to start to end rates mid-2015, but wants to be confident in their inflation forecast before they move.
Western Asset Management is one of the world's leading fixed-income managers with $466 billion in assets under management as of December 31, 2014. The firm is a wholly owned, independently operated subsidiary of Legg Mason, Inc. (NYSE: LM) From offices in Pasadena, Hong Kong, London, Melbourne, New York, Sao Paulo, Singapore, Tokyo and Dubai, the company provides investment services for a wide variety of global clients, across an equally wide variety of mandates.
About Legg Mason
Legg Mason, Inc. is a global asset management firm with assets under management of $709.1 billion as of December 31, 2014. The Company provides active asset management in many major investment centers throughout the world. Legg Mason is headquartered in Baltimore, MD and its common stock is listed on the New York Stock Exchange (symbol: LM).
All investing involves risk. Past performance is no guarantee of future results.
Western Asset Core Plus Fund: Investments in fixed-income securities involve interest rate, credit, inflation and reinvestment risks; and possible loss of principal. An increase in interest rates will reduce the value of fixed income securities. The Fund may use derivatives, such as options and futures, which can be illiquid, may disproportionately increase losses, and have a potentially large impact on Fund performance. Leverage may increase volatility and possibility of loss. International investments are subject to special risks including currency fluctuations, social, economic and political uncertainties, which could increase volatility. These risks are magnified in emerging markets. Asset-backed, mortgage- backed or mortgage-related securities are subject to prepayment and extension risks. Risks of high-yield securities include greater price volatility, illiquidity and possibility of default. Potential active and frequent trading may result in higher transaction costs and increased investor liability. Diversification does not assure a profit or protect against market loss.
Western Asset Core Fund: Fixed-income securities involve interest rate, credit, inflation, and reinvestment risks; and possible loss of principal. As interest rates rise, the value of fixed-income securities falls. Derivatives, such as options and futures, can be illiquid, may disproportionately increase losses, and have a potentially large impact on fund performance. Investing in asset-backed, mortgage-backed or mortgage-related securities subjects the Fund to additional risks such as prepayment and extension risks. The Fund may engage in active and frequent trading, resulting in higher transaction costs and increased investor liability. Diversification does not assure a profit or protect against market loss. Please see the prospectus for a more complete discussion of the Fund's risks.
The Morningstar awards acknowledge managers who not only delivered impressive performance in 2014, but who have also shown excellent long-term risk-adjusted returns, and have been good stewards of fund shareholders' capital, as noted on the Morningstar website.
Morningstar Awards 2014(c). Morningstar, Inc. All Rights Reserved. Awarded to: Ken Leech, Carl Eichstaedt, and Mark Lindbloom, Western Asset Core Bond (WACSX) and Western Asset Core Plus Bond (WAPSX) for U.S. Fixed Income Fund Manager of the Year.
Before investing, carefully consider a fund's investment objectives, risks, charges and expenses. You can find this and other information in the Fund's prospectus available at www.leggmason.com/individualinvestors
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