Market structure across asset classes is continuously evolving. Consequently, financial markets can be seen as adaptive as the underlying dynamics and interactions between the different actors are not stable through time. These shifts in dynamics in turn impact the risks
Global Asset Allocation Insights Inflation is still stubbornly high, meaning the Fed and the ECB are keeping their feet pressed down on the hawkish pedal for now. However, growth data is turning sharply negative in developed markets as the consumer
Riddles in the Dark Time, the answer to Gollum’s riddle, is to us a vaunted teacher. The first half of 2022 has been a turbulent one. In analysing ‘The Road Ahead’ from this point, our first port is the precedent
At the end of last year, we described a liquidity hole that we expected would grow and envelop most assets. Last year, the fundamental conditions for assets (particularly bonds) deteriorated quickly, but asset purchases by the Fed combined with huge
Krachtige macrotrends zoals vergrijzing en het ‘consumentisme’ van de gezondheidszorg staan aan de basis van private equity beleggingen in het thema gezondheid. De gezondheidszorg wordt door sterke trends gedreven, zoals stijgende zorgkosten, vergrijzing, nieuwe technologie en toetreders tot de markt en het
This is the second edition of our regular monitoring of the path to net-zero. We continue to focus on the C20 – the 20 largest CO2 emitter countries (see Figure 1). These countries accounted for 80% of global CO2 emissions in 2021 and 18
Emerging market equity returns have been resilient year-to-date in the face of increasing uncertainty over the global economy and rising interest rates. The region remains our preferred choice in our model asset allocation, especially if inflation peaks, which we expect
Using Bitcoin mining to combust leaking methane sources can eliminate 5.32% of all global emissions by 2045. This represents 23% of all global methane emissions: more than half the UNEP’s targeted reduction of methane of 45% by 2045. That means
How can concepts like diversification, risk targeting and risk management help build robust multi-strategy portfolios? And how can they be applied in practice? Constructing a robust portfolio is not easy. Even if you expect a relatively benign economic and market
Biodiversity will become one the largest investment megatrends in our lives, and the theme is at an inflection point Biodiversity: The neglected existential risk Much of the investment industry’s rhetoric is about capital – whether that’s financial, produced, human or
CROSS ASSET Investment Strategy While a global recession may be avoided, we are likely to see growth deceleration and high inflation (higher cost of living) along with regional divergences. Thus, investors should consider moving to a more cautious stance on
BII Global weekly commentary The new regime of macro volatility is playing out with weaker growth, persistent inflation and volatile markets. We stick with our dialed-down risk stance. U.S. stocks slumped and yields surged on a renewed rise in core
Green Bonds KWARTAALUPDAT Een obligatie is niet zomaar ‘groen’ te noemen. Om dit predicaat te mogen dragen, moet een obligatie aan verschillende criteria voldoen. Een dubbelinterview met een uitgever én een belegger wijst bovendien uit dat er meer is wat
It Fooled You Once… Coming out of the annual Jackson Hole meeting, Fed Chairman Jerome Powell’s speech, unsurprisingly, had a strong tone reinforcing the Fed’s intention to fight inflation at any cost, a 180-degree reversal of his ‘inflation is transient’
Earlier this month, Cliff Asness at AQR wrote a really interesting piece about interest rates and how they may not be as related to the valuation or performance of growth or value stocks as we all think. This piece followed
US commercial real estate (CRE) investors are well-versed in the importance of economic growth to property investment performance. Focus on the Covid-19 recession, policies to truncate it and the path of recovery have dominated the attention of analysts for more
The Federal Reserve has an explicit dual mandate. Managed Futures strategies have an implicit one – specifically, 1) deliver positive returns on average and 2) generate especially attractive returns during large equity market drawdowns.1 This dual mandate is one of
Underpinned by waning inflation and strong job numbers in the US, equity markets started the month trending higher. Investors believed peak inflation would lead to a potential pivot in Federal Reserve (Fed) policy hawkishness. However, in his Jackson Hole speech,
ETFs posted net inflows of $1.3bn last week. Equity ETFs captured $1.3bn, while Fixed Income ones had smaller inflows of $210mn as higher than expected US inflation numbers caught the market by surprise. Commodity ETFs, on the other hand, saw
Yields have again risen on all assets but we think this is largely compensating for greater policy/recession risk (we think we are in the contraction phase of the cycle). We boost cash to further Overweight, while reducing equities to further
Economic cycles have been a crucial driver for financial markets, making regime-based dynamic asset allocation (DAA) a common practice in supporting optimal portfolio construction. Changes in key economic indicators, monetary policy trends and the evolution of financial leverage have proven
China’s ascension over the past twenty years to the second largest economy in the world has changed the global landscape in a variety of ways. As China’s economic size and market capitalization grows, many investors have reasonably been pondering how
After investors have learned the basics of bitcoin, they often ask, “how is it possible to own an asset if they are unable to determine what its fair value should be?” Valuation methods vary widely across a variety of assets,
Looking back, private markets have experienced robust returns, with 2021 marking a high point. While there is no investible index in the same way as for public markets, the database of private markets funds, captured by Burgiss, reported investment returns
It seems obvious to so many that interest rates drive the value trade.1 After all, growth stocks2 have much longerdated cash flows than value stocks and thus should be a “longer duration” asset and move more with longer-term interest rates,
How to Prep Your Portfolio for a Different Kind of Recession Risk. During the first half of 2022, global equity markets tumbled around 20% from their January peak, with losses on typical stock/ bond portfolios almost as large, as bonds
At $639.0 billion in H1 2022, fund commitments continue to be robust, roughly on pace to match 2021 totals. While the steady growth in fundraising has flattened out since the advent of COVID-19, maintaining levels similar to the record 2019
Only a few market events in an investor’s career really matter, and among the most important of all are superbubbles.1 These superbubbles are events unlike any others: while there are only a few in history for investors to study, they
Impact investing originated in philanthropy and started from a need to close a funding gap in private markets. This to a certain extent explains why the traditional purist definition of impact investing remains constrained to certain asset classes. The landscape
Europe’s energy supply shock is creating a painful stagflation, and policy makers face a difficult set of choices. Looking forward, structurally higher energy prices will be a long-term competitiveness challenge for Europe.
What to Expect from the Biggest Protocol Change to the World’s Second-Largest Digital Asset One of the most anticipated events in the history of the digital asset industry is set to take place in September – The Ethereum Merge. This
2022 has been one of the most volatile periods in recent years for global equity and fixed income markets. The outbreak of the war in Ukraine, global supply chain disruptions, global inflationary pressures, less accommodative central banks and COVID-19 restrictions
Companies are facing a number of macro headwinds and ongoing margin pressures. While this environment can be challenging, we think many high yield companies are wellpositioned to navigate an economic slowdown given low leverage, healthy balance sheets and few near-term
As we have discussed in past research, true diversification benefits primarily result from the thoughtful combination of differentiated return streams (i.e., betas). By contrast, many investors assemble portfolios that reflect diversification-in-nameonly (DINO), by adding an ever-growing number of portfolio segments
Responsible investing is heavy with buzzwords and acronyms: ESG, SDGs and more. But in a world liberally scattered with jargon, what are we to make of a recently popular concept – the circular economy? And why should investors join us
ECB forced to tighten more agressively
Outsourced trading should not be seen as an alternative, but as a partner offering a broad spectrum of products and services for fund managers to choose from. A fund manager considering outsourcing should first assess the needs of their portfolio
Nederland zakt drie plaatsen op ranglijst van meest aantrekkelijke landen om met pensioen te gaan Tiende jaarlijkse Global Retirement Index (GRI) onthult dat 2022 het meest uitdagende jaar kan worden om met pensioen te gaan in de recente geschiedenis, omdat
ETFs posted net inflows of $471mn, driven by Fixed Income and Money Market ETFs, which gathered $911mn and $360mn, respectively. Equity suffered net outflows of $581mn while Commodity lost $243mn
De groeiende sector van hernieuwbare energie in China biedt sterke groeivooruitzichten omdat het land ambitieuze nettonuldoelstellingen stelt. Van luchtvervuiling en stijgende zeespiegels tot bodemverontreiniging en waterschaarste, China, 's werelds grootste uitstoter van broeikasgassen, kampt met …
Venture capital plays a leading role in the story of American innovation. Venture capital was instrumental in the birth of legendary Silicon Valley firms such as Apple and Google. Venture-backed firms ushered in the information revolution, cementing America's status as
Investment Regime: a phase of transition, complicated. • Markets are in a transition from a Covid world with low/zero interest rates and no inflation to super strong inflation and firm central banks • At this time visibility is limited both
In this report, we present the DWS long-term capital market assumptions for major asset classes as of the end of June 2022 while exploring the risks to these forecasts.
The Jackson Hole conference made it clear that fighting inflation, even if it leads to economic hardship, is priority number one for monetary policymakers. Except for the Bank of Japan, central banks will stick to their aggressive tightening path, …
Investors’ Outlook: The news flow ebbed over the summer but the headlines that did come through weren’t always positive. One small news item may have cheered us up, though: After 12 years under the European Union’s watchful eyes, Greece …
Een zachte landing van de wereldeconomie lijkt steeds onwaarschijnlijker. Dat betekent dat risicovollere activaklassen nog verder kunnen dalen. De stijging van de aandelenmarkten die begon met de hittegolf deze zomer is volgens ons voorbij. Vanaf nu zullen de omstandigheden waarschijnlijk
1. De context Maatschappelijk verantwoord beleggen (MVB) is de afgelopen jaren bij pensioenfondsen in een stroomversnelling geraakt. Wet- en regelgeving leggen steeds meer nadruk op aandacht voor milieu-, sociale en governance-factoren (ESG-factoren) in het beleggingsproces. Initiatieven zoals het IMVB-convenant (Sociaal
INTRODUCTION In early 2022, scientists announced that the earth crossed six1 of the nine planetary boundaries demarcating the safe operating space for humanity: Pollution from ‘novel entities’2 , freshwater, climate change, biosphere integrity, biogeochemical cycles and land-system change. This unravelling
During 2020 the market went through a number of distinct phases from, 1) ignorance of the impending COVID-19 effects (January, February) to, 2) panic (end of February to mid-April) to, 3) the “world will need to change” as a broad
The next five years will be an uphill struggle for investors. High public and corporate debt levels, labour shortages, potential tax hikes and increased levels of state intervention will mean slower economic growth. Add to that the prospect of prolonged
