Despite well-publicised moves to restructure its economy over the past few years, China remains a key investment destination due to the attraction of its enormous domestic market. And as the world’s second-largest economy, China is also deeply interconnected with the
1. High yield is a growth sensitive asset class: The high-yield market has historically produced positive results over a full cycle, but it tends to do particularly well during the recovery phase of the business cycle as default rates fall,
Before we go further, we should define our terms. A sustainability-linked bond (SLB) is a general proceeds debt instrument, meaning the issuer does not have to predetermine projects and allocation of proceeds. Instead, the funds may be used for general
This paper studies the cross-section of expected municipal bond returns. We show that municipal bond yields contain reliable information about differences in expected municipal bond returns across states of issuance, duration range, and credit quality. Hence, using information embedded in
We remain defensive as geopolitical risks escalate. The war in Ukraine and associated sanctions on Russia increases the risk of further negative supply shocks to commodities and supply chain disruptions, adding to the case for persistently high inflation and slower
Endowment funds are investment funds set up for the benefit of educational and other institutions and funded by gifts and donations. Particularly in the US, universities, museums and hospitals all have endowment funds. The largest belong to American universities, led
ETFs posted net inflows of $1.8bn last week.Commodity saw the strongest net inflows, gathering $850mn. Equity and Fixed Income saw relatively muted but still positive net inflows of $673mn and $207mn, respectively.
Our initial 2022 outlook themes generally played out as expected in the first quarter: strong but slower economic growth, persistently hotter inflation, the onset of interest rate hikes and further bouts of elevated market volatility. But two developments were unexpected:
– ETFs posted net inflows of $1.9bn last week. Equity attracted $1.1bn while Commodity saw $516mn of net inflows. – Fixed Income took in $408mn while Money Market weathered net outflows of $135mn.
INTRODUCTION: This report presents Angeles Investment Advisors’ updated capital market assumptions as of January 2022. These assumptions are used in asset allocation modeling for our clients over a long-term horizon (>10 years). Versus our most recent assumptions from our 2021
Executive Summary “Uncertainty must be taken in a sense radically distinct from the familiar notion of Risk, from which it has never been properly separated…. It will appear that a measurable uncertainty, or "risk" proper…. is so far different from
After the substantial fiscal and monetary policy measures implemented in the wake of the pandemic and the subsequent lockdowns, a slowdown in global growth comes as no surprise to anyone. Most of the stimulus in the form of direct payments
Impact investing is not new, but the development around dedicated private equity impact funds has accelerated in recent years. Increasing political and social pressure, growing awareness among customers and businesses and the emergence of sector initiatives have helped to create
The first and most prominent component of interest rate risk is that of parallel shifts of the interest rate curve. Approximately 90% of the movements in the interest rate term structure can be reflected as parallel shifts. Liability-driven investors can
In brief Our proprietary analysis of trends among the 100 largest corporate pensions by assets found that the 2021 headline funded status is finally approaching full funding 13 years after the global financial crisis (GFC), with more than 70% of
Current Market Conditions Strong performance across both growth and value strategies during 2021 2021 returns for U.S. equity markets are eye-popping: – S&P 500: +28.7% – U.S. Small Cap: +14.8% – Non-U.S. equity markets lagged: – MSCI World ex USA:
Ukraine: where do we stand? The first month of the Russia-Ukraine war has driven volatility up across the board, though with some recent signs of stabilisation in equity markets. Europe is the area most exposed to the war – in
Sustainable Leadership in Financial Services Sustainable leadership. What does that actually mean? And what does it entail for the Financial Services sector? Does it mean shifting strategies from making profits to ensuring the planet is ok? To care about the
Investor relations (IR) teams increasingly field questions for their companies about sustainability topics. According to our most recent edition of Global Trends in Investor Relations, 71.3% of IR teams globally reported in 2019 that ESG/CSR communications with investors are among
Higher inflation and in some cases, rising inflation expectations, have been a key focus for investors this year, in both emerging and developed markets (DM). This is against a backdrop of large fiscal and monetary stimulus from governments around the
A key channel of contagion to fixed income markets outside of Russia/Ukraine is likely to be through commodity prices. Russia is the largest exporter of natural gas and the second-largest exporter of crude oil and petroleum products. The US has
Simplify the problem: A tighter focus. It has been an eventful start to the year. A significant rotation in equity market leadership in the early part of 2022’s first quarter saw the prospects for growth stocks derailed. This was followed
March has been a month of multiple material developments. Not only the rapid victory envisioned by President Putin did not occur, but the possibilities for a long-lasting conflict have increased. The military stalemate and the dislocation of the political equilibriums
ETFs posted a massive $10.2bn of net inflows last week. Flows were driven mainly by Equity, which captured $7.8bn, and Fixed Income, which gathered $2.1bn. Commodity also saw healthy net inflows of $515mn while Money Market exposures lost $198mn.
The past month, and indeed the entire first quarter, has been dramatic in every respect. The invasion of Ukraine by Russian troops not only revealed that German politicians in particular had been mistaken about the Russian leader, Vladimir Putin. It
Against a background of structurally higher inflation and declining growth, exacerbated by Russia’s invasion of Ukraine, the Asset Allocation Committee’s (“AAC”) views have become more risk-averse. They have also realigned with what we see as a new investment regime, signs
Each month, the State Street Global Advisors’ Investment Solutions Group (ISG) meets to debate and ultimately determine a Tactical Asset Allocation (TAA) that can be used to help guide near-term investment decisions for client portfolios. By focusing on asset allocation,
Sellwood Consulting updates its capital markets assumptions on an annual basis. Our 2022 assumptions reflect information as of December 31, 2021, unless otherwise noted. This report documents our process for creating these capital markets assumptions, and we provide detailed methodology
Clear insights into multi-asset investing, macro and research Key points As our multi-asset franchise, All Roads, reached its 10-year milestone, we applied the investment and research insights gained in the past decade to assess the prevailing risk of Q1 –
Executive Summary Insurance leaders are continuing to eye payment transformation as a strategic imperative in 2022 and beyond, as they navigate challenges fueled by aging legacy systems, high check volumes of traditional payables and receivables, as well as increasing client
Russia’s military aggression against Ukraine, which has become Europe’s largest ground war in generations, has impacted millions of people and triggered a large-scale humanitarian crisis as vulnerable Ukrainians take shelter or flee their homes. The intensification and spread of the
Geopolitical Risks – April update The Russian invasion of Ukraine is the largest, most dangerous military mobilization in Europe since WWII. It has upended the geopolitical order, with profound implications for financial markets and the global economy. Indeed, our overall
Monthly update We keep the narratives and the probabilities of our central and alternative scenario unchanged versus last month. The war in Ukraine could evolve in several ways over the coming weeks (see Ukraine crisis tree) with significant implications on
German consumer price rises hit a 42-year high, and probably have not peaked yet In Germany and elsewhere, inflation has accelerated and will probably continue to do so for quite a while. Each new inflation release increases pressures on central
The uncertainty caused by the war in Ukraine, the sharp increase in commodity prices, and the deterioration of supply chain issues are dampening the economic outlook. At the same time, the inflation risks have increased drastically. The Fed has promised
In the past decades, humankind has been facing evermore alarming events which have shifted our consciousness towards more sustainable thinking. Natural disasters, such as immense bushfires in Australia, countless floods throughout Europe, Asia and the US or social disasters, such
The world’s stock markets display a decades-long pattern of overnight and intraday returns seemingly consistent with only one explanation: one or more large, long-lived quant firms tending to expand its portfolio early in the day (when its trading moves prices
Swap spreads, the difference between the yield on daily collateralized swaps and benchmark sovereign debt, are observed for many reasons: amongst others as an economic risk indicator; a measure of investor preferences over time; and an important consideration in setting
After months of heightened tensions between the Ukraine and Russia, the situation reached a turning point on February 22. Russian President Vladimir Putin signed a decree recognising the independence of Luhansk and Donetsk, paving the way for the invasion of
Fertilizer prices have risen rapidly following the Russian invasion of Ukraine. Russia is a material producer and exporter of fertilizer. The combination of sanctions, shipping firms avoiding the Black Sea region and Western banks, and traders shunning Russian supplies has
In February 2018, Templeton Global Macro (TGM) released its original paper on the topic of environmental, social and governance (ESG) factors in sovereign fixed income investing. The paper (Global Macro Shifts—issue 9 [GMS-9]) explored the team’s novel approach to ESG
The economy is facing two shocks. An inflation shock has led to a sharp hawkish shift by central banks. The Fed is now expected to raise policy rates to 2.5% this year. The BoJ is the outlier in the developed
The war in Ukraine adds another supply-side shock and increases economic uncertainty at a time when macro policy is constrained by high inflation and strained public finances. Despite this, most stock markets are trading higher today than at the start
Russia’s invasion of Ukraine has intensified focus on geopolitical risks. However, investing amid geopolitical uncertainty is not new. Seasoned portfolio managers Kirstie Spence and Victor Kohn discuss how they approach geopolitical risk in emerging markets.
The third year of the Covid crisis began with renewed concerns over the interplay between surging inflation and an economic recovery contingent on concerns over policy tightening, a trend further accelerated by the Russian-Ukrainian conflict. While we collectively gather ourselves
No doubt, war is a human tragedy. It requires heavy reflection on what has transpired and how it can be avoided in the future. However, the current situation also demands that, as fiduciaries, we delve deeply into what the implications
Uncertainty still surrounds the Ukraine war and its economic fallout. The world's major economies went into the current crisis with fairly sound fundamentals, positive growth and low unemployment. Several were still enjoying the boost from withdrawing social distancing measures introduced
Economics • Russia invasion delays recovery. Uncertainty and higher prices weigh on economy. • Price increases continue. Energy and food prices as drivers. Several months of …
The benefits of cashflow driven investment (CDI) are slightly controversial. Some believe it is a powerful risk management strategy for DB schemes nearing their endgames, whereas others are more sceptical given that it may compromise …
