Core Viewpoint - The midyear outlook for global financial markets indicates a shift towards deglobalization, a reconfiguration of global trade due to tariffs, and an expansion of stock market opportunities beyond U.S. equities and mega-cap tech stocks, alongside a bond market regime change driven by trade policy and German fiscal expansion [1][2]. Economic Outlook - The global economy is facing pressures from trade war fallout, which could slow growth, with U.S. fiscal and tax policy expected to be significant in the latter half of the year [6]. - The likelihood of a global recession has increased, particularly with the U.S. leading the downturn, resulting in a longer period of subpar growth characterized by higher unemployment and inflation [5][7]. Equity Market Insights - There is an anticipated broadening of equity markets, reducing the concentration on U.S. and mega-cap stocks, favoring value stocks and select emerging markets [4][6]. - Active management is expected to outperform in the current challenging market environment, which includes higher interest rates and increased volatility [2]. Fixed Income Landscape - The U.S. tariffs and significant German fiscal expansion have altered the global fixed income landscape, leading to a weaker outlook for developed market sovereign bonds while improving prospects for credit and some emerging markets [5][6]. - Above-target inflation is noted in some developed markets, particularly the U.S., affecting corporate bonds which are entering an economic downturn with historically high credit quality [6]. Multi-Asset Strategy - T. Rowe Price emphasizes inflation protection and equity diversification in its multi-asset portfolios, suggesting that inflation-protected bonds and real assets can serve as effective hedges against expected inflation [6]. - More attractive valuations are leading to a preference for international and value equities in multi-asset portfolio allocations [6].

Core Viewpoint - Janus Henderson Investors aims to assist clients in achieving their long-term financial goals through active management, emphasizing the importance of translating ideas into action and building partnerships for optimal client outcomes [1] Company Overview - Janus Henderson Investors was formed in 2017 from the merger of Janus Capital Group and Henderson Global Investors, reflecting a commitment to adding value through active management [1] - The company promotes a collaborative team environment, which is encapsulated in their "Knowledge. Shared" ethos, fostering dialogue and empowering clients to make informed investment decisions [1] Investment Approach - The investment managers at Janus Henderson have the flexibility to adopt strategies that align with their areas of expertise, ensuring a tailored approach to investment management [1]

Core Viewpoint - The article emphasizes that a HODL strategy may not yield significant alpha or maintain a high Sharpe ratio over the long term, suggesting that active management is essential for maximizing returns and minimizing opportunity costs [1]. Group 1: Investment Strategy - The company advocates for active management in investment strategies to achieve high positive returns, indicating that simply holding assets is insufficient for generating high alpha [1]. - It is highlighted that seeking high returns does not equate to generating high alpha, which is a critical distinction for investors [1]. Group 2: Analyst Background - The analyst has a strong educational background with a degree in Business Economics from UCLA and a Master of Accounting from UMich Ross School of Business, indicating a solid foundation in financial analysis [1]. - The analyst's experience includes a role as a senior analyst at a multi-strategy hedge fund, showcasing expertise in fundamental equity research and global macro strategy [1].

Company Overview - Federated Hermes manages \$839.8 billion in assets, including \$202.7 billion in long-term managed assets: \$80.9 billion in equity, \$99.5 billion in fixed income, \$19.4 billion in alternative/private markets, and \$2.8 billion in multi-asset [12] - The company's total revenue for Q1 2025 was \$423.5 million [14] - Liquidity assets under management are \$637.1 billion [10, 17] Q1 2025 Highlights - Earnings per share were \$1.25 [20] - Equity assets increased by \$1.5 billion, a 2% rise from \$79.4 billion at the end of 2024 [20] - Fixed-income assets increased by \$1.4 billion, a 1% rise from \$98.1 billion at the end of 2024 [22] - Liquidity assets increased by \$6.8 billion, a 1% rise from \$630.3 billion at the end of 2024 [22] Revenue Diversification - Revenue less distribution expense was \$168 million in Q1 2013 and \$324 million in Q1 2025 [25] - Money market funds contribute an average of 34% to revenue less distribution expense, with a high of 61% and a low of 13% [24] - Equity contributes an average of 43% to revenue less distribution expense, with a high of 56% and a low of 27% [24] - Fixed income contributes an average of 18% to revenue less distribution expense, with a high of 25% and a low of 11% [24] - Alternative/private markets and multi-asset contribute an average of 9% to revenue less distribution expense, with a high of 19% and a low of 6% [24] Asset Distribution - U S Financial Intermediaries account for 67% of total assets under management [27] - U S Institutional accounts for 26% of total assets under management [27] - International accounts for 7% of total assets under management [27]

Financial Data and Key Metrics Changes - Total assets under management (AUM) decreased to $167.5 billion as of March 31, primarily due to market performance and net outflows [9][16][20] - Earnings per share (EPS) as adjusted was $5.73, a decline from the previous quarter but an increase of 6% year-over-year [13][28] - Operating income as adjusted was $54.6 million, down from $74.5 million sequentially, largely due to seasonal employment expenses [26][27] Business Line Data and Key Metrics Changes - Institutional AUM accounted for 34% of total AUM, with net outflows of $1.2 billion primarily from large cap equity strategies [16][20] - Retail separate accounts experienced net outflows of $700 million, largely due to the soft closing of a specific equity model offering [10][21] - ETFs saw positive net flows of $300 million, with a year-over-year organic growth rate of 73% [12][20] Market Data and Key Metrics Changes - Total sales for the quarter were $6.2 billion, slightly down from $6.4 billion in the previous quarter, with stable sales across products despite market disruptions [9][19] - Institutional sales remained relatively unchanged at $1.5 billion, while retail separate account sales were also stable at $1.7 billion [19][20] - The average fee rate was 41.7 basis points, consistent with the previous quarter, reflecting a mix of asset classes [22] Company Strategy and Development Direction - The company is focused on expanding its offerings in ETFs, global funds, and retail separate accounts, with several strategies under development [8][9] - Management emphasized the importance of active management in volatile markets, with over 70% of equity strategies outperforming their benchmarks [7][8] - The company aims to maintain a balanced approach to capital management, investing in growth while returning capital to shareholders [14][15] Management's Comments on Operating Environment and Future Outlook - Management noted ongoing market volatility and uncertainty, which they believe provides opportunities for active managers to demonstrate value [6][10] - The company remains cautious about investor behavior in light of market conditions, with trends in retail investments remaining consistent [12][20] - Management expressed confidence in their investment performance, with a strong track record recognized by industry rankings [8][18] Other Important Information - The company repurchased approximately 146,000 shares during the quarter, reducing shares outstanding by 3% on a net basis [14][29] - The first quarter typically represents the highest cash utilization due to annual incentives and revenue participation payments [29][30] - The net present value of the tax asset is approximately $112 million, providing a cash tax benefit not included in adjusted EPS [31] Q&A Session Summary Question: Fee rate outlook and changes - Management indicated that the fee rate will be influenced by market conditions and the mix of assets, with a target range of 41 to 42 basis points for modeling purposes [32][34] Question: Capital allocation and share repurchases - Management acknowledged an increase in share repurchases compared to previous quarters, emphasizing the importance of stock performance in capital allocation decisions [36][38] Question: SMAs and capacity constraints - Management confirmed that the soft closing of a successful SMA strategy was a response to market challenges, but they have other strategies available to investors [42][44] - There are no current capacity constraints in other areas of the retail channel, with expectations for growth in mid-cap strategies [45] Question: Monetizing deferred tax assets - Management clarified that they are achieving economic benefits from tax attributes and will continue to provide transparency regarding their value [46][47]

Financial Data and Key Metrics Changes - Total revenues increased by 5% driven by positive asset growth and higher transactional activity [10] - Earnings rose by 8% with EPS up 13%, reflecting strong business growth and ongoing expense discipline [10] - Return on equity excluding AOCI remains at 52%, indicating best-in-class performance [10] Business Line Data and Key Metrics Changes - In Wealth Management, assets increased by 7% to $1 trillion, with inflows of $10.3 billion [11] - Wrap activity saw a 34% increase in flows to $8.7 billion, with total wrap assets growing by 10% to $573 billion [12] - Retirement Protection Solutions reported strong earnings with annuities growing by 28% and life business sales up by 22% [23] - Asset Management faced challenges with net outflows of $18.3 billion, despite strong investment performance [25][50] Market Data and Key Metrics Changes - Assets under management and advisement reached $1.5 trillion, benefiting from strong net client flows and equity market appreciation [39] - The bank's assets grew to over $24 billion, contributing positively to earnings [20] Company Strategy and Development Direction - The company is focused on enhancing its advice value proposition and integrating technology to support advisers [14][17] - A new Unified Managed Account (UMA) platform called Signature Wealth is being tested, expected to launch soon [15][66] - The company aims to maintain flexibility and opportunism in a volatile market environment, supported by a strong capital position [30][84] Management's Comments on Operating Environment and Future Outlook - Management acknowledges ongoing market volatility and economic uncertainty but expresses confidence in the company's diversified business model [8][36] - The outlook for net interest income is positive due to proactive portfolio adjustments [62] - The company remains committed to returning capital to shareholders, with an 8% dividend increase announced [31][41] Other Important Information - The company achieved a 12% increase in adviser productivity, reflecting strong asset growth [17] - Client satisfaction remains high, with a rating of 4.9 out of 5 [18] - The company has been recognized for its technology innovation and client engagement strategies [16][33] Q&A Session Summary Question: Outlook for AWM NII and bank earnings - Management expects improvement in net interest income based on recent actions taken [62] Question: Details on Signature Wealth platform - Signature Wealth is a comprehensive UMA platform that offers flexibility for advisers and clients [66] Question: AWM flows and competitive landscape - Management reports strong client activity and engagement, with good new asset additions [71] Question: Adviser recruiting environment - The company has seen good recruitment numbers and a strong pipeline for the second quarter [95] Question: Capital position and potential acquisitions - Management emphasizes flexibility in responding to market opportunities due to a strong capital position [84] Question: G&A expenses outlook - G&A expenses are expected to remain flat for the year [134] Question: Client behavior in April - No significant changes in client transactional activity have been observed despite market volatility [138]

Core Insights - NVIDIA Corporation (NASDAQ: NVDA) reported a double beat on revenue and non-GAAP EPS for 4Q FY2025, yet a potential 8% drop in stock price is anticipated following the announcement [1]. Financial Performance - The company achieved a double beat on revenue and non-GAAP EPS in its latest quarterly results, indicating strong financial performance [1]. Market Reaction - Despite the positive earnings report, the U.S. equity market's current conditions may lead to a decline in NVIDIA's stock price by approximately 8% [1].