Witten by Henriette Le Mintier, rates & credit portfolio manager LBP AM

A specialist in bond markets for over 20 years, I am a fixed-income and credit portfolio manager, responsible for absolute return portfolios. My summer holiday destination is in Brittany: Pléneuf-Val-André, a charming French seaside resort on the east coast of the Bay of Saint-Brieuc, in the Côtes-d’Armor area. The Côtes-d’Armor coastline is characterised by a wide variety of coastal landscapes, featuring wild coves and fine sandy beaches, nestled between hills and steep cliffs. The scenery is breathtaking, stretching from Cap Fréhel in the east to the Pink Granite Coast in the west.

Economically speaking, the Côtes d’Armor area stands out for its still significant agricultural sector, characterised by the prominence of cattle and pig farming – the Breton pig market in Plérin serves as a benchmark for setting pork prices across France. The coastline is ideal for sea fishing, with seven ports, including Erquy, France’s fourth-largest fishing port. The harvesting of scallops is one of the Côtes d’Armor’s specialities. The Bay of Saint-Brieuc is renowned for its production, with a biomass of 80,000 tonnes of scallops, out of a total of 200,000 tonnes in France. And, of course, tourism plays a key role in the local economy. The 350 km of coastline is home to the vast majority of summer holiday resorts, in popular seaside towns such as Perros-Guirec, Erquy, Saint-Cast-Le-Guildo, Pléneuf-Val-André and Trégastel.

Agile on any terrain  

In Pléneuf-Val-André, our Augusts are punctuated by the intangible and invigorating rituals of family holidays : large, lively meals bringing together children, grandparents and cousins in the family home; shellfish gathering at low tide; not to mention tennis, football and volleyball sessions. We also, without fail, visit the National Stud Farm in Lamballe to stroll past the stables or enjoy the equestrian events. As a keen horse rider, I still go horse-riding from time to time. When I was younger, I used to do show jumping and ride in the side-saddle position. It requires precise technique, a keen sense of balance and perfect harmony with your horse.

My fascination with movement goes far beyond horses. I also love anything with an engine: I enjoy sailing, I love the thrill of sports cars and I’m a motorcyclist. My love of motorbikes, particularly off-road riding, has taken me along extraordinary tracks on road trips through Latin America, Madagascar and Thailand. Freedom, mobility and agility: for me, these themes also serve as a guiding principle in the financial markets, and that’s no coincidence! I manage absolute return investment strategies, whose flexible approach is based on a range of instruments and fixed-income asset classes. Diversifying drivers, adapting to each environment, seeking the right balance and finding alternatives whatever the terrain or obstacles: that’s what I love, whether I’m in front of a Bloomberg terminal, on a motorbike, on horseback or on a boat!

Absolute return approach

Designed to target positive returns across different market phases, by stability, risk control and reliable sources of performance, absolute return approach is not tied to a benchmark : it can combine various instruments and assets on bond markets. This flexibility makes it possible to increase the decorrelation between individual sources of return, better cushion potential market shocks and still actively participate in upward movements.

At present, we think the current rates level in fixed income are supportive for sovereign bonds. Over the past few months, we have strengthened the rates sensitivity. On credit side, we try to benefit from returns levels and attractive spreads on 2-4 years maturity segment of the yield curve. We also have integrated inflation derivatives, very useful as protective instruments able to monitor the volatility, during the Iran war sequence. 

Globally, our approach is still active, mobile, in aim to capture any opportunity on all kind of issuer and diversification stays a key driver. In terms of bond picking, we maintain a selective approach to carry trades and remain cautious towards the most cyclical sectors. In our view, financial issuers remain of interest, as their fundamentals stay solid and their relative valuation levels seem still attractive. As example, we pick up some qualitative bonds in Eastern Europe and Italian banking sector, as part of a diversification strategy. For investors – and probably even more so in Switzerland than elsewhere, traditionally – this combination of flexibility, risk control, stability and broad diversification can be a significant advantage.