CMA – What kind of Expected Returns do you expect?

By January 14, 2020 12:28

CMA – What kind of Expected Returns do you expect?

Three different expectations for the next decade

Nr 1: Invesco – 2020 Long-Term Capital Market Assumptions

2020 Long-Term Capital Market AssumptionsNext to its quarterly ‘The Big Picture’ report, Invesco publishes an annual Capital Market Assumptions report with expected returns over a 10 year horizon. For most asset classes Invesco’s expectations lie close to the consensus, but for several the result is more deviant.

Invesco expects an annual return of 4.3% for European equities, which is 140 bps lower than the consensus expected return. Invesco thinks that European equities are more sensitive to geopolitical uncertainty than other developed markets. Together with continued slow economic growth Invesco finds the combination of cyclical and structural challenges to pressure the expected results of European equities. Invesco is more optimistic than  the consensus for the Asia Pacific ex-Japan equReities and states it is an attractive asset class, but higher than normal volatility is to be expected. Also for commodities Invesco expects higher returns than the consensus.

Full rapport: Invesco – 2020 Long-Term Capital Market Assumptions

Nr 2: JP Morgan – Long Term Capital Market Assumptions: Time-tested projections to build stronger portfolios

Long-Term Capital Market AssumptionsIn its annual CMA report. JP Morgan looks ahead what to expect from the global markets and what returns to expect on average for the coming 10 to 15 years. JP Morgan’s expectations are amongst the market’s most read CMA reports.


JP Morgan expects higher-than-consensus returns for all equity asset classes. Most noticeably for emerging market equities. Also for both European, American and Emerging market JP Morgan’s expected returns are above the consensus expected returns. Interesting is that JP Morgan downgraded most returns from the 2019 expectations, but are still on the high side compared to the other expectations. As for alternatives, JP Morgan’s expectations are largely in line with the consensus.

Full rapport: JP Morgan – Long Term Capital Market Assumptions: Time-tested projections to build stronger portfolios

Nr 3: Amundi – Asset Class Return Forecasts

Asset Class Return ForecastsLastly, we look at Amundi’s capital market assumptions, which are published for both a 3, 5 and 10 year horizon. Especially Amundi’s equity and fixed income assumptions for the coming 3 years, are largely below the consensus expected return. For fixed income assets classes, this is also the case for the longer term. On the other hand, for a longer time horizon, the expected returns for equities are higher than the consensus.

Amundi expects US fixed income to remain the most attractive fixed income classes for a longer time. Amundi also expects the ECB to continue with the unconventional monetary policies for longer, pressing on the carry European fixed income.

For equities, Amundi sees a profit recession for equities to have kicked in, and expects this to continue into the future. Amundi expects this to pressure the returns of developed market equities the most and sees an attractive asset class in emerging market equities. In general Amundi expects modest returns due to continued pullback in global trade and manufacturing.

Full rapport: Amundi – Asset Class Return Forecast

By January 14, 2020 12:28



Munis hit turbulence in a flight to safety -> #cash #coronavirus #FixedIncome #lending #municipalbond #COVID19 via

Emerging markets debt: Determinants of sovereign bond quality and returns -> #credit #EmergingMarkets #debt #fiscalpolicy #sovereignbonds via


Fixed Income Market Update -> #fixedincome #highyield #EMD via #Voya

The corona shock in commodity prices -> #Commodities #GOLD #oilprice #OPEC #coronavirus #COVID19 via

US Senate approved US fiscal package -> #fiscal #CoronaCrisis #COVIDー19 #inflation #Recession2020 via

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