Highlights of last week: Long-Term Outlook and Liquidity

beheerder
By October 5, 2020 08:45

Highlights of last week: Long-Term Outlook and Liquidity

#40

Before we show you research-highlights of this week, let’s see what webinars you do not want to miss! On Wednesday 7 October, T. Rowe Price hosts a webinar called “What will a new era bring for Japan” and BNP Paribas AM will host a webinar on Thursday 8 October called “The Great Instability“. Now, two must-reads will follow: 

Long-Term Outlook – Macroeconomic Scenarios and Expected Returns 2021 – 2024

Aegon AM 

In their Long-Term Outlook, Aegon AM published in chapter 1 ‘Thematic articles’, for example on ESG Megatrends, chapter 2 ‘Global macroeconomic developments’, in which they discuss several regions, and in chapter 3 they discuss ‘Financial markets’ and dive into several asset classes. On the topic ESG Megatrends, they write:

“Environmental, social and governance (ESG) issues are increasingly gaining prominence across the globe. From social unrest in the form of protests for democracy or against discrimination, to pandemics and lockdowns, to environmental degradation and climate change, the current paradigm will be transformed by ESG trends as we progress through the 21st century. We believe this change, however, will not only affect the political and societal status quo. As consumption and production patterns change – willingly or not – the economy may be transformed beyond recognition, for better or for worse. In a recent paper, we reviewed the literature about ‘ESG megatrends’ that could shape the world for many years to come. We identified 16 such trends, along environmental, social and governance themes (Figure 1).”

long term outlook esg

Why does liquidity matter – Flash update

UBP AM

“Liquidity took a central stage during the Covid-19 sell-off. As such, Covid-19 should serve as a wake-up call for investors with regard to the role of liquidity in portfolios. At UBP Global & Absolute Return Fixed Income team, we believe liquidity matters for portfolio management and performance.

(…)

“Drawdown mitigation. In addition to income optimisation and outperformance, liquidity also enables investors to improve the Sharpe ratio of their investments with lower drawdowns. Liquidity does matter in terms of drawdown mitigation: what is more liquid behaves better in times of stress and the Covid-19 crisis was a live test for fixed income strategies in that respect. The value-added of the team’s focus on liquidity can be measured in 3 different market segments: Absolute return, investment grade, and high yield.”

Furthermore, UBP AM published a podcast on this content as well:

📣Podcast

 

podcast liquidity

 

These were OpinioPro’s highlights of week #40! We post new research every working day. Do you want to receive our newsletter to stay up-to-date on the latest investment research? Please sign up here. And don’t forget to check out our Events Calendar!

beheerder
By October 5, 2020 08:45

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"#Global #debt was at an unprecedented level before Covid-19. With the subsequent policy response injecting #liquidity into most parts of the world economy, the debt predicament is ..." -> https://www.opiniopro.com/2020/10/columbia-threadneedle/implications-of-the-global-debt-explosion/

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