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
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
We expect the second half of 2022 to present the same macro headwinds that posed a challenge in the first half: inflation, aggressive central bank action, growth concerns and wavering sentiment. Broadly, the pace and aggressiveness at which central …
According to the International Energy Agency, in order to meet the Paris Agreement’s goals (climate stabilization at “well below” 2 degrees Celsius global temperature rise), mineral requirements for clean energy technologies would need to quadruple by 2040. In addition, in
The bar for monetary authorities to make a dovish pivot is quite high, as evidenced by recent statements by Chair Powell, et al. Even if there was a pivot later this year it would still imply a decent moderation in
Understanding the potential impact of climate change and the interaction between different stakeholders, initiatives, metrics, and tools presents challenges. There is a growing need for investors to understand the risks, opportunities and the impact on investment portfolios that come with
High yield bonds are frequently misunderstood, with an undeserved reputation for being high risk. We view them as a hybrid asset class, sitting between equity and traditional debt markets. In our view, high yield bonds exhibit compelling …
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
Since at least February, with the start of Russia-Ukraine War, many investors and sell-side analysts have sounded the alarm that private label was positioned to gain meaningful market share at the expense of branded food. There was certainly a logic
Russia’s war with Ukraine has led to a substantial demand shock from European countries for liquid natural gas (LNG) imports as the EU seeks to reduce its imports of Russian gas by two-thirds. They hope to offset the shortfall primarily
The alternative fixed income asset class is highly diverse, embracing private debt, consumer loans, mortgage investments, insured loans, loans to small and medium-sized enterprises (SMEs), infrastructure debt and asset-backed securities (ABS). These assets can offer enhanced yields compared to government
June’s Consumer Price Index (CPI) was about the worst composition possible from a Fed perspective as it was (1) a broad-based increase that (2) accelerated. The base effect was supposed to be shading inflation down, but it’s been totally overrun
In this article, we consider the future of responsible investment expectations in a defined contribution (DC) pensions world. In particular, the expectations of individual members and their pension providers. These are necessarily aligned in the longer term – providers will
The Low-Income Housing Tax Credit (LIHTC) program is the most significant resource for creating affordable housing in the United States. Created by the Tax Reform Act of 1986, the LIHTC program gives state and local LIHTC-allocating agencies tax credits worth
Cross asset allocation: Our pessimistic views on the direction of global growth have led us to change our scores for equities from neutral to underweight, and fixed income from neutral to overweight; commodities and cash remain neutral. While equity market
Dear Mr Draghi, After a busy couple of months leading a fractious Italian government through various crises, you must be looking forward to a well-deserved summer holiday. Before you and your team leave for the beach, the ECB is preparing
As a keen driving enthusiast, the future of autos is a subject close to my heart. Put me behind the wheel on an open, winding, country road and I will soon be enjoying myself. But I’m also an autos analyst,
Pensioenakkoord uitgelegd – Deel 10 In de zomer van 2020 hebben het kabinet en sociale partners overeenstemming bereikt over een vergaande herziening van het pensioenstelsel. Dit pensioenakkoord heeft grote gevolgen voor hoe pensioen wordt opgebouwd en wordt belegd. In deze
For most risk assets, total return is achieved predominantly via capital price return, but not in high yield. Over long-term periods, income tends to drive the bulk of the total return for high yield bonds. In fact, over 100% of
The past decade has been an exceptionally profitable period to be invested in global equity markets, with the MSCI AC World Index averaging 10.6% per annum in the 10 years to 31 March 2022*. Solid GDP growth, low interest rates
US CRE MARKET INSIGHTS June 2022: First quarter US CRE investment performance reported by NCREIF’s National Property Index (NPI) offers a continuation of the extraordinary total returns produced during 2021. Total return for the year ending March 2022 reached a
For the past couple of decades, China has been the driver of the health of the global metals industry as it accounts for roughly 50% of demand for a number of metals commodities. More recently, two other factors have driven
The 2020s so far have forced a global realization that threats posed by climate change are severe, urgent, and soon, irreversible. It is rather unusual to wake up to the start of the new year with a 13oC on the
High yield bonds have become a mainstream asset class for many institutional investors. Historic returns are impressive, particularly on risk-adjusted measures, and an allocation to high yield bonds can add value to an overall portfolio. For defined contribution (DC) pension
Higher prices supported by a considerable percentage of global production coming from Russia and Ukraine have caught many commodities in the crosshairs of the Russian-Ukraine war. Concerns are growing over the ability to source these commodities from outside of Ukraine
Cross asset allocation: Our neutral score across all main asset classes represents a more cautious tone in markets that we see carrying on through the second quarter of 2022. Increased hawkishness by major central banks despite the ongoing Russia-Ukraine war
Heading into 2022, the high yield bond market was a tale of two halves. On one hand, solid company fundamentals, balanced technicals and the ongoing economic recovery painted a supportive backdrop. On the other, valuations were historically rich, with tight
Households are about to experience the biggest hit to disposable income in a long time. Rising inflation, continued supply chain constraints and now the Russia-Ukraine war have piled on seemingly all at once. The swelling piggybanks from stashing away cash
One commodity negatively impacted by the war is neon gas, a key input used in the semiconductor process. Bulk neon gas is a byproduct of the steel industry (primarily the Russian steel industry), which is captured and filtered to achieve
The lead time of curve inversion to recession can be more than two years, so it’s not the best timing tool. However, what we do know with more certainty is the signaling that the economy is now firmly in the
Pensioenakkoord uitgelegd – Deel 9: Veel pensioenfondsen staan aan de vooravond van een wijziging van de pensioenregeling. Momenteel wordt er volop gerekend hoe de nieuwe pensioenregelingen – de solidaire en flexibele premieregeling- in ALMstudies uitpakken. Het is echter ook informatief
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
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
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
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
Time and time again, energy markets have demonstrated the ability to respond to global events faster than consumers are able to keep up. From liquefied natural gas (LNG) ships literally turning around mid-journeyii to the tripling of refining margins,(iii) recent
At the end of 2021, US commercial property investors were contemplating prospects for an easing Covid -19 threat in the year ahead along with still-strong economic growth accompanied by tightening interest rates to quell inflation. As often happens, it’s not
Active Ownership Report 2020: Welcome to our second annual Active Ownership Report, in which we report on our activities globally for the first time. The objective of this report is to inform our clients and other stakeholders of our stewardship
Cross asset allocation: Despite a volatile end to the year for markets, 2021 still was marked by strong equity market returns and above-trend economic growth. We expect the pace of growth to moderate in 2022. Central banks have begun removing
US CRE Market Insights – March 2022: Recently released fourth quarter and annual 2021 US CRE investment performance data show a continuing pattern of feast or famine across the four major sectors. Feasting in the industrial sector has produced a
Starting in 2003, Michael Dooley published a series of papers proposing the idea of a Bretton Woods revival as the plausible rationale for China’s relatively extreme foreign currency reserve accumulation policy.
The International Financial Reporting Standards (IFRS) are a set of uniform accounting principles which are particularly relevant for publicly-listed companies. Some major IFRS standards have been completely revised in recent years. In 2018 the introduction of IFRS 9, the accounting
In our view, the Federal Reserve (Fed) has two choices to make for their stance on future monetary policy: to normalize or ‘Volckerize.’ The latter refers to Paul Volcker, Chair of the Fed most remembered for raising the fed funds
The 2020s so far have forced a global realization that threats posed by climate change are severe, urgent, and soon, irreversible. It is rather unusual to wake up to the start of the new year with a 13oC on the
For three decades global inflation was on a downward trend. But in recent months inflation has risen sharply. The question which many investors are asking is whether this higher inflation rate is transitory or not? This article summarises our views
Cross asset allocation: Despite a volatile end to the year for markets, 2021 still was marked by strong equity market returns and above-trend economic growth. We expect the pace of growth to moderate in 2022. Central banks have begun removing
In our view, the Federal Reserve (Fed) has two choices to make for their stance on future monetary policy: to normalize or ‘Volckerize.’ The latter refers to Paul Volcker, Chair of the Fed most remembered for raising the fed funds
Overnight headlines that Russia has begun a full-scale invasion of Ukraine have sent financial markets into acute risk-off mode. Equity markets fell sharply, oil prices jumped above $100 per barrel, and government bond yields declined. Markets had already been impacted
In de zomer van 2020 hebben het kabinet en sociale partners overeenstemming bereikt over een vergaande herziening van het pensioenstelsel. Dit pensioenakkoord heeft grote gevolgen voor hoe pensioen wordt opgebouwd en wordt belegd. In deze serie bespreken we het pensioenakkoord
