Eric Jacobson: So, let's talk about China for a minute and some of the other areas that are risks in terms of them slowing down and other internal risks that some of these countries have. But China in particular, what is the biggest risk in terms of China and the rest of the economy, the global economy and of course us in particular in the United States?
Dan Ivascyn: Sure. So, with China we have a near-term geopolitical situation occurring on the Korean Peninsula. That although again in the base case, we think there will be lots of concerning rhetoric that won't lead to actual conflict. But that’s something that needs to be in the minds of investors from a risk-management perspective. In terms of the long-term challenges of China, China is in the midst of a transition from an export-driven growth model to a model that’s more balanced and focusing more over time on internal sources of demand.
For other countries going through a similar transition that has typically been marked by a lot of volatility, when we look at China today, we're cautiously optimistic. We think that they are learning from the standpoint of policy decisions. There will be bouts of volatility, but we think in general they have sufficient flexibility to continue to navigate through this period. We've seen a reduction in credit growth recently that’s going to be important to watch. There are significant amounts of debt. Most of that debt being internal and likely to be able to be managed by policymakers, but it's certainly a risk. And it’s a risk quite frankly that the markets are a lot less focused on today than they were about a year and a half ago. With all the focus on Europe's election cycle, all the focus on the U.S. administration's priorities, we do think China is an area that people have tended to forget about. And those tend to represent some of the best active investment opportunities, when you can attempt to get an edge in an area where people aren’t quite focusing as much as they probably should.
Jacobson: So, do you think that China is a buying opportunity right now, or what's your take on that?
Ivascyn: We don’t have significant positions in China. They have local markets that are developing. There are some select opportunities within the corporate credit space. We don’t have significant positions in the Chinese currency. What we are really looking to do across portfolios is to use some of the instruments in Asia and China in particular to round out overall portfolio risk. But we don’t have high-conviction trades there. A slight bias towards protecting portfolios from some further currency weakness, which again is not our base case, but certainly could occur, and it could occur in an environment where the Fed needs to be a bit more active than we in the market suggest for the next 12 to 18 months.