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☆ BlackRock's Rieder thinks investors should believe the Fed that it's going to hike again
▼ + stars: | 2023-09-28 | by ( Jeff Cox | ) www.cnbc.com time to read: +3 min

"You've got to take them at their word that they want to get another 25" basis points, said the asset management giant's CIO of global fixed income. BlackRock fixed income chief Rick Rieder thinks the Federal Reserve can stop raising interest rates, though it probably won't. The fed funds rate, used as a benchmark for many forms of short-term debt, currently is targeted in a range between 5.25%-5.50%. "I love commercial paper," Rieder said. Rieder said he expects the Fed to start cutting at some point, but probably not until the latter half of 2024.

Persons: You've, you've, Rieder, Rick Rieder, Rebecca Patterson, Ray Organizations: Alpha, BlackRock, Economic Education, Delivering Alpha, Council for Economic Education, Bridgewater Associates, AA, Fed Locations: BlackRock

☆ A recession is coming and investors should be defensive, TCW CEO says
▼ + stars: | 2023-09-28 | by ( Jeff Cox | ) www.cnbc.com time to read: +1 min

A recession is all but inevitable for the U.S. and investors should be playing defense in that kind of environment, according to the head of the TCW Group. "We are going to have a recession, because that's the way the world works," Katie Koch, CEO of the firm with $210 billion under management, said Thursday at CNBC's "Delivering Alpha" conference. Higher rates have long been thought to work with lag effects, the timing of which is uncertain and dependent on a variety of factors. "I do think it pays to be patient and wait to see higher rates work their way through the system," Koch said. "We haven't seen the pain of higher rates, but it's coming."

Persons: Katie Koch, Koch Organizations: U.S, TCW, Alpha Locations: U.S

☆ The Sharpe angle: Sizing up the private credit market with Michael Arougheti
▼ + stars: | 2023-09-27 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailThe Sharpe angle: Sizing up the private credit market with Michael AroughetiCNBC's Leslie Picker sits down with Ares Management CEO Michael Arougheti just a year after their first conversation for the Delivering Alpha Newsletter. In this interview, Arougheti addresses the boom in private credit, points to opportunities in the banking space after the March turmoil, and explains how a higher-for-longer interest rate regime could impact his industry.

Persons: Michael Arougheti CNBC's Leslie Picker, Michael Arougheti Organizations: Ares Management, Alpha

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, September 26, 2023. Brendan McDermid | ReutersA majority of Wall Street investors haven't taken solace in stocks' 2023 gains, thinking the market could retreat further as risk of a recession creeps up, according to the new CNBC Delivering Alpha investor survey. Zoom In Icon Arrows pointing outwardsMore than 60% of respondents believe the stock market's gain this year has just been a bear market bounce, seeing more trouble ahead. A total of 39% of investors believe we are already in a new bull market. The market also contended with a rally in crude oil as well as a 10-week winning streak for the dollar.

Persons: Brendan McDermid, Stocks Organizations: New York Stock Exchange, Reuters, Wall Street, CNBC Delivering Alpha, CNBC, Federal Reserve Locations: New York City

☆ Bill Ackman lays out a series of reasons why he's betting rates keep rising — How you can play along
▼ + stars: | 2023-09-22 | by ( Jesse Pound | In Jesse-Pound | ) www.cnbc.com time to read: +2 min

The 30-year Treasury yield was trading at 4.575% on Friday morning after hitting its highest level since 2011 on Thursday. US30Y YTD mountain The 30-year Treasury yield hit a new high for the year on Thursday. Ackman said he thinks 5.5% could be more the rational yield for the 30-year Treasury. The largest inverse bond ETF is the ProShares UltraShort 20+ Year Treasury ETF (TBT) , according to VettaFi. ProShares also has the Short 20+ Year Treasury ETF (TBF) , which is a one-times inverse fund.

Persons: Bill Ackman, Ackman, Ackman's, ProShares Organizations: Treasury, Reserve, Workers, ICE U.S, Pershing, Capital Management, CNBC, Alpha Locations: China

Major League Baseball was the first to open its coffers to private-investment funds in 2019; a slew of other leagues followed, including the National Basketball Association, Major League Soccer and the National Hockey League. A big participant in that is Sixth Street Partners, a $74 billion behemoth, known historically for its direct lending and growth prowess, and has been making big inroads in the sports world in recent years, with several billion dollars' worth of investments. The firm recently co-founded Bay FC, part of the National Women's Soccer League, alongside several retired players, as well as Sheryl Sandberg. Sixth Street also made investments in FC Barcelona's LaLiga TV broadcasting rights and a majority investment in Legends, a sports and entertainment experiences company. In June 2021, Sixth Street led a strategic investment with Michael Dell in the San Antonio Spurs basketball team.

Persons: Carlyle, David Rubenstein, Sheryl Sandberg, Michael Dell, Alan Waxman, what's, it's, Waxman Organizations: Alpha, CNBC, Major League Baseball, National Basketball Association, Major League Soccer, National Hockey League, Sixth Street Partners, Bay FC, National Women's Soccer League, Sixth, FC Barcelona's LaLiga, San Antonio Spurs basketball, Spanish soccer, Real Madrid Locations: U.S, Spanish

☆ KKR's private equity co-head says it's a great time to do deals, but be sure to exercise caution
▼ + stars: | 2023-07-27 | by ( Yun Li | ) www.cnbc.com time to read: +1 min

Brendan McDermid | ReutersPrivate equity firms should be motivated to hunt for deals despite the challenging interest rate environment as the potential purchase price tends to be more in their favor, according to KKR's Global Co-Head of Private Equity Pete Stavros. "This is a great time to do deals," Stavros said in an interview with CNBC's Leslie Picker for the Delivering Alpha newsletter. Zoom In Icon Arrows pointing outwardsPrivate equity fundraising has slowed down drastically after a series of aggressive interest rate hikes made borrowing costs skyrocket. Globally, private equity funds raised $444.65 billion in the first half, down 20.5% year over year from, according to S&P Global Market Intelligence. "When the public markets are more volatile and when credit markets are tighter, better return deals are done.

Persons: Brendan McDermid, Private Equity Pete Stavros, Stavros, CNBC's Leslie Picker Organizations: KKR, New York Stock Exchange, Reuters, KKR's Global, Private Equity, Delivering Alpha, P Global Market Intelligence

☆ Private equity giant KKR's antidote to worker discontent — employee stock ownership programs
▼ + stars: | 2023-07-27 | by ( Leslie Picker | ) www.cnbc.com time to read: +3 min

The job market may be strong, but the invisible strings that connect workers to their jobs are increasingly weaker. As the co-head of global private equity at KKR , he's been a key champion of instilling employee stock ownership programs in all the companies the firm buys for its $19 billion Americas Fund. "It's better for investors, it's better for the company, it's better for employees, and in the end, it's better for the communities that they live in." Over 60,000 non-management employees have been awarded billions of dollars in total equity value through these ownership programs since 2011, the firm said. Through the non-profit, other private-equity firms like Apollo and TPG also committed to advancing shared ownership within their own portfolios.

Persons: Pete Stavros, he's, it's, Stavros Organizations: Alpha, UPS, KKR, Employees, Apollo, TPG Locations: Capital

☆ SEC seeks rule change that could cause fund managers to take less risk
▼ + stars: | 2023-07-07 | by ( Leslie Picker | ) www.cnbc.com time to read: +3 min

A sweeping change sought by the Securities and Exchange Commission would take fund managers' culpability a step further than current standards if they don't effectuate a greater standard of care. The rule change involves lowering the bar for indemnification of fund managers to "ordinary negligence" from "gross negligence." "It would monumentally change the relationship between fund managers and investors," said Marc Elovitz, partner and chair of the regulatory practice at Schulte Roth & Zabel, in an interview for the Delivering Alpha Newsletter. And investment managers are going to have a hard time protecting themselves from being on the hook for those risks." However, ILPA said that, "an ordinary negligence standard as applied to breach of contract would assure meaningful progress."

Persons: Marc Elovitz, Schulte Roth, Zabel, Schulte's Elovitz, ILPA, Gary Gensler Organizations: New York Stock Exchange, Securities and Exchange, Alpha, Institutional Limited Partners Association, SEC, Fund Advisers Locations: New York City

Most Wall Street investors believe the best way to take advantage of the artificial intelligence boom is to buy Big Tech stocks, according to the new CNBC Delivering Alpha investor survey. Forty-seven percent of respondents said big-cap tech companies are the best way to invest in AI, while 37% believe there's too much hype around the space. The chipmaker has been at the center of an AI craze on Wall Street. Investors piled into the AI enabler after the company recently made a shockingly strong forecast of future demand. Alphabet's AI capabilities and ambition attracted buying from big investors recently, including Stanley Druckenmiller 's Duquesne Family Office, Dan Loeb's Third Point and Bill Ackman's Pershing Square Capital Management.

Persons: Buzzy chatbot ChatGPT, Stanley Druckenmiller, Dan Loeb's, Bill Ackman's Organizations: Big Tech, CNBC Delivering Alpha, CNBC, Nasdaq, Microsoft, Google, Duquesne Family Office, Bill Ackman's Pershing, Capital Management

Source: NYSEThe majority of Wall Street investors believe stocks have entered a new bull market and the U.S. economy will skirt a recession in 2023, according to the new CNBC Delivering Alpha investor survey. Zoom In Icon Arrows pointing outwardsSixty-one percent of respondents believe the market has entered a new bull run, while 39% think this is a bear market rally. Technically speaking, some have already declared a brand new bull market after the S&P 500 met the most simplistic standard by closing up 20% from its October bear market low. However, many investors do not consider it the end of a bear market until the S&P 500 reaches a new high. The S&P 500 is about to end the first half with flying colors, up nearly 15% after four straight winning months in a row.

Persons: Carol Schleif, Jason Draho Organizations: NYSE, Wall, CNBC Delivering Alpha, CNBC, BMO Family Office, UBS Global Wealth Management Locations: U.S

☆ Hindenburg Research goes after Carl Icahn in latest campaign for market-moving short seller
▼ + stars: | 2023-05-02 | by ( Yun Li | ) www.cnbc.com time to read: +1 min

Carl Icahn speaking at Delivering Alpha in New York on Sept. 13, 2016.Notable short seller Hindenburg Research is going after famed activist investor Carl Icahn. "Overall, we think Icahn, a legend of Wall Street, has made a classic mistake of taking on too much leverage in the face of sustained losses: a combination that rarely ends well," Hindenburg Research said in a note released Tuesday. Headquartered in Sunny Isles Beach, Florida, Icahn Enterprises is a holding company that involves in a myriad of businesses including energy, automotive, food packaging, metals and real estate. Hindenburg said it believes the high dividend yield is "unsupported" by the company's cash flow and investment performance. Shares of Icahn Enterprises are down 0.5% on the year as of Monday's close.

☆ Carl Icahn calls Illumina Q1 results ‘very disappointing,’ slams cost-cutting plan
▼ + stars: | 2023-04-28 | by ( Annika Kim Constantino | ) www.cnbc.com time to read: +3 min

Carl Icahn on Friday called Illumina's first-quarter results "very disappointing" and slammed the DNA sequencing company's new plans to cut costs. "Illumina CEO Francis deSouza seems to believe that he can fool all of the people all of the time," Icahn wrote. Illumina's stock is down more than 9% since the company reported earnings. In that missive, Icahn also took shots at cost-cutting plans Illumina unveiled to improve its shrinking margins. Illumina reported a negative operating margin of 5.7% for the quarter, down from 15% during the same period a year ago.

☆ As Wall Street turns bearish on the U.S., here's where the pros say to invest
▼ + stars: | 2023-04-04 | by ( Zavier Ong | ) www.cnbc.com time to read: +6 min

Within Europe, Goldman prefers companies in value sectors that pay dividends , as well as select defensive and growth stocks in the market. Emerging markets Several Wall Street analysts are putting their money on emerging markets, with most bullish on China, the world's second-largest economy. While the bank expects just 1% earnings growth for emerging market stocks, it said the sector's valuation looks attractive at a 23% discount to global peers. Philip Blancato, CEO at Ladenburg Thalmann Asset Management, is also bullish on emerging markets. He added that the case for adding to emerging market allocations is growing, particularly given the "near guarantee" of a softer dollar in the short- to medium-term.

☆ Play defense with these fortress stocks in the second quarter
▼ + stars: | 2023-04-02 | by ( Michelle Fox | ) www.cnbc.com time to read: +9 min

Bahnsen's investment philosophy focuses specifically on high-quality stocks that have a high dividend yield, along with consistent increases. One of his favorite plays is Procter & Gamble , which currently has a dividend yield of 2.5%. EOG has a 2.9% dividend yield and also has been paying a special dividend. Health-care names Names in the health-care sector are generally considered defensive. Quanta Services has a dividend yield on the lower end, at 0.2%.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, March 28, 2023. Brendan McDermid | ReutersWall Street investors believe the stock market is headed for losses after a positive first quarter, seeing cash as the best safe haven right now, according to the new CNBC Delivering Alpha investor survey. Zoom In Icon Arrows pointing outwardsThe Fed enacted a quarter percentage point interest rate increase last week, while signaling one more rate hike coming this year. Many investors believe the central bank should reverse course immediately as more rate hikes will exacerbate banking problems and cause a severe economic slowdown. With an overall bearish view on the market, 60% of the investors said cash is their safe haven right now.

The majority of Wall Street investors now favor stocks that pay big dividends for a relatively stable source of income, according to the new CNBC Delivering Alpha investor survey. We polled about 400 chief investment officers, equity strategists, portfolio managers and CNBC contributors who manage money about where they stood on the markets for the second quarter and forward. Asked which area to concentrate on to start the second quarter, 34% of respondents said high dividend stocks. Stocks with high dividend payouts can provide a reliable stream of income during times of uncertainty. Some of the most popular exchange-traded funds that focus on high dividend stocks include the Vanguard Dividend Appreciation ETF , the Vanguard High Dividend Yield ETF and the Schwab U.S. Dividend Equity ETF .

☆ Goldman says stock picking is back in 2023 and names shares 'likely to generate the largest alpha'
▼ + stars: | 2023-02-13 | by ( John Melloy | ) www.cnbc.com time to read: +2 min

The Goldman note discusses how so-called return dispersion is increasing, which basically means stocks are starting to move independently and not together as a group. "Rising return dispersion and an increasing micro share of stock returns means more opportunity for stock pickers to capture alpha," wrote Kostin. Capturing or delivering alpha simply means assuming more risk in the stock market by taking an active rather than passive approach to investing in an attempt to outperform the market. Where to find alpha Goldman calculated a dispersion score for each stock that looks at how much of its return is driven by company-specific factors and how volatile the stock is likely to be. The following are among the stocks Goldman calculates as having the highest dispersion scores.

☆ Activist investor Elliott Management reportedly takes stake in Salesforce
▼ + stars: | 2023-01-23 | by ( ) www.cnbc.com time to read: +2 min

Paul Singer, founder of Elliott Management, speaking at Delivering Alpha in New York on Sept. 13, 2016. Activist investor Elliott Management Corp has made a multi-billion dollar investment in cloud-based software firm Salesforce Inc, according to people familiar with the matter. It is unclear what Elliott, one of the world's most prominent activist investors, is pushing for at Salesforce. "We look forward to working constructively with Salesforce to realize the value befitting a company of its stature," Jesse Cohn, managing partner at Elliott told Reuters. It recently won a board seat at Pinterest Inc when the company added Elliott portfolio manager Marc Steinberg as a director.

☆ Disney could use an activist investor like Nelson Peltz to help get its financial house in order
▼ + stars: | 2023-01-19 | by ( Paulina Likos | ) www.cnbc.com time to read: +5 min

An activist investor like Trian Partners' Nelson Peltz on Walt Disney 's (DIS) board could help prod the entertainment conglomerate to address its financial woes and implement much-needed changes to create long-term value for the company and its shareholders. "Lots of angry people ask me why I support Nelson Peltz for the Disney board, and I give a simple answer: What has this board done for its shareholders other than wipe out more shareholder money?" Nonetheless, Disney's board unanimously decided against offering Peltz a seat, according to an SEC filing the company submitted Tuesday. Peltz, whose next step in his fight is to convince voting Disney shareholders he deserves a board seat, has had success serving on several company boards. Wall Street has had a mixed reaction to Peltz's efforts to obtain a board seat.

☆ Nelson Peltz's attempt to join Disney's board could force much-needed accountability
▼ + stars: | 2023-01-12 | by ( Paulina Likos | ) www.cnbc.com time to read: +7 min

If Nelson Peltz were to win his fight to join Walt Disney 's (DIS) board of directors, the activist investor could force a level of accountability at the company that's sorely needed. Disney's board made the decision to not endorse Peltz and swiftly announced Wednesday that they named Mark Parker, a director since 2016 and executive chairman at Nike (NKE), as chairman, succeeding Susan Arnold. Disney, Peltz explained, "is a lot more than a media company." Disney's streaming business lost nearly $1.5 billion last quarter. Given Disney's distressed balance sheet, Jim asked Peltz about streaming service Hulu.

Once high-flying mega-cap technology stocks tumbled in 2022, but some investors are willing to bet on Amazon and Alphabet in 2023, a new Delivering Alpha investor survey suggests. Betting on energy Energy stocks rallied in 2022 as the world grappled with supply constraints fueled by the conflict in Ukraine, but some investors aren't giving up on it just yet. When asked which areas they plan to focus on at the beginning of 2023, 41% of respondents highlighted energy stocks. Fundstrat's Tom Lee told CNBC last month that energy stocks can more than double next year even if the market stays flat . As uncertainty lingers, survey respondents also said they plan to look beyond the U.S. in 2023 toward opportunities in emerging markets.

Source: NYSE(Click here to subscribe to the new Delivering Alpha newsletter.) Despite this year's market havoc, investors are feeling fairly optimistic going into 2023, according to a new CNBC Delivering Alpha investor survey. Notably, when asked about their biggest concern for the market, an overwhelming 73% of the participating money managers said it was Fed policy. Zoom In Icon Arrows pointing outwards CNBC Delivering Alpha investor surveyComing in second place was a Chinese invasion of Taiwan. Inflation and the investing environmentAbout four out of five participating money managers predict that inflation will continue to ease in the new year.

☆ Citadel's Ken Griffin warns the US economy will enter an immediate 'great depression' if China invades Taiwan and cuts off access to its semiconductor industry
▼ + stars: | 2022-11-16 | by ( ) www.businessinsider.com time to read: +2 min

Citadel founder Ken Griffin speaks at the CNBC Delivering Alpha conference in New York on September 28, 2022. CNBCThe US economy would immediately enter a great depression if China invades Taiwan, according to Citadel founder Ken Griffin. The US is "playing with fire" as it balances a sensitive relationship between China and Taiwan, according to Citadel founder Ken Griffin. In an interview with Bloomberg on Tuesday, Griffin said the US would enter an "immediate great depression" if China invades Taiwan and cuts off access to its semiconductor industry. But that concentrated bet could be a big loser if Griffin's bleak view on China and Taiwan ultimately pans out.

☆ It's the bond market's time to shine
▼ + stars: | 2022-11-06 | by ( William Edwards | ) www.businessinsider.com time to read: +6 min

Bond yields are at their highest levels in years. The result has been nothing but pain for stock and bond prices since the start of the year. Another reason is because in a recessionary environment, bond prices typically rise as investors pile into safe-haven assets like Treasurys. "Bond investors are facing a unique win-win scenario right now," Saperstein said in an October memo. He continued: "If inflation and rates continue to rise, bond prices will decline but unrealized price losses can be meaningfully offset by locked-in 4-6% income returns.

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