Joining us now, Ali Debage, uh Janice Henderson, uh investors chief investment officer and just beautiful orange stuff everywhere. Nothing to do with Bitcoin. Uh but the the little and is Janice Henderson aligned with its clients.It is indeed. Yeah. Okay.Yeah. We pride ourselves with working with our clients and delivering for their their missions. And I'm excited to talk to you about something we don't always talk about and that is uh fixed income. you want to talk about fixed income or or you absolutely d ...

Core Viewpoint - The discussion highlights the current investment landscape, focusing on fixed income and equities, with an emphasis on the potential for longer duration investments and opportunities in the equity market despite economic slowdowns. Fixed Income - The securitized sector is trading cheaply, and there is an expectation for duration extension as the market enters a cycle of easing [2][6] - Investors are likely to seek longer duration elements such as mortgage-backed securities and asset-backed securities [4][6] - The JAA ETF, which provides AAA collateralized loan obligation (CLO) exposure, is highlighted as a safe investment with a good spread, currently crossing $25 billion in assets [6] - CLOs are considered safer than corporate bonds if appropriately rated, with improvements in rating accuracy since the 2008 financial crisis [8] - Yield expectations range from mid-single to high-single digit yields, with specific mention of 7% yields for triple B rated investments [10][12] Equities - There are significant opportunities in the equity market, particularly in companies that have been undervalued or pushed to high valuations [13][15] - The recent performance of Oracle, which saw a 40% increase in a week, exemplifies the potential for substantial gains in large-cap stocks [14] - Investors are focusing on innovative sectors that can navigate geopolitical tensions, with strong interest in healthcare and technology [15][16] - Small and mid-cap stocks are viewed as undervalued and have the potential to deliver significant returns despite a slowing economy [17]

Financial Data and Key Metrics Changes - Assets under management decreased by 1% to $373.2 billion, with market declines partially offset by $2 billion of positive net flows and favorable currency adjustments [6][10] - Adjusted diluted EPS increased by 11% to $0.79 compared to Q1 2024, with operating income up 22% year-over-year [9][23] - Adjusted revenue decreased by 14% compared to the prior quarter but increased by 14% year-over-year due to higher management fees [23][24] Business Line Data and Key Metrics Changes - Net inflows for the quarter were $2 billion, a significant improvement from net outflows of $3 billion a year ago, driven by a 44% increase in gross sales [13][20] - Fixed income net inflows were $5.6 billion, compared to $5.2 billion in the prior quarter, with active fixed income ETFs leading the positive flows [20][21] - Equity flows were negative $4.2 billion, reflecting a challenging environment for active equities [20] Market Data and Key Metrics Changes - The U.S. intermediary channel experienced positive net flows for the seventh consecutive quarter, with contributions from various strategies including active ETFs and U.S. mid-cap growth [15][16] - Asia Pacific intermediary net flows were positive for the third consecutive quarter, marking the best result in over three years [17] - Institutional net inflows were $800 million, including $600 million of ETF net inflows, indicating increased interest from institutional clients [17] Company Strategy and Development Direction - The company announced a strategic partnership with Guardian Life Insurance Company, managing a $45 billion investment-grade public fixed income portfolio, which is expected to enhance growth and institutional reach [42][43] - The strategic pillars focus on protecting and growing core businesses, amplifying strengths, and diversifying where clients provide opportunities [32][34] - The company is actively pursuing M&A opportunities to enhance growth and leverage its strong balance sheet [34][71] Management's Comments on Operating Environment and Future Outlook - Management acknowledged tumultuous market conditions but expressed confidence in navigating uncertainty due to a global footprint and diverse client base [5][6] - The long-term investment performance remains solid, with over 65% of assets beating benchmarks over three, five, and ten-year periods [8][12] - Management emphasized the importance of active management in capitalizing on market dislocations and opportunities [8][86] Other Important Information - The company announced a 3% increase in the quarterly dividend and a new share buyback authorization of up to $200 million through April 2026 [10][30] - Adjusted operating expenses decreased by 9% to $330 million compared to the prior quarter, reflecting cost discipline [24][26] - The liquidity profile remains strong, with cash and cash equivalents at $1.1 billion, a 19% increase year-over-year [29][30] Q&A Session Summary Question: Thoughts on CLO ETF capacity and liquidity - Management noted that they hold about 80% market share in the CLO ETF category and have seen stable flows even during market volatility [52][54] Question: Next steps for institutional channel performance - Management highlighted a significant increase in RFP activity and consultant support, indicating a positive outlook for institutional flows [56][58] Question: Opportunities for growth with Guardian - Management expressed optimism about enhancing Guardian's investment capabilities and leveraging their distribution platform for mutual growth [66][68] Question: M&A interest and market conditions - Management indicated a very active M&A environment and a reduction in the bid-ask spread, while remaining disciplined in their approach [71][73] Question: Organic growth expectations for the insurance client business - Management expects continued growth in the $45 billion AUM from Guardian, emphasizing the potential for further asset acquisition in the insurance sector [77][79] Question: Active management opportunities in 2025 - Management sees significant opportunities arising from market dislocations and a strong demand for active management strategies [84][86] Question: Regional demand differences in intermediary and institutional channels - Management noted stability in institutional channels while acknowledging some volatility in intermediary channels, particularly in EMEA and the U.S. [94][96]