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Why ESG Factors Matter in Asia Credit Investing

Why ESG Factors Matter in Asia Credit Investing

🕔16:40, 12.Apr 2021

Why ESG Factors Matter in Asia Credit Investing Integrating ESG factors can help manage downside risk and identify high‑quality businesses driving positive change. Already mainstream in Europe, responsible investing is fast becoming a key consideration in Asia as well. The integration

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Value Investing: Capitulation or Opportunity?

Value Investing: Capitulation or Opportunity?

🕔16:20, 12.Apr 2021

The MSCI World Value index is a well-known proxy for the performance of value stocks. The index relies on three value factors (earnings-forward-to-price and dividend yields) and five growth factors to allocate to stocks. The stocks in the …

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Foundations of a cycle-driven approach to asset allocation

Foundations of a cycle-driven approach to asset allocation

🕔13:55, 12.Apr 2021

Foundations of a cycle-driven approach to asset allocation Countercyclical Investing

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A distinctive approach to investing

A distinctive approach to investing

🕔12:02, 12.Apr 2021

A distinctive approach to investing  Capital Group has been investing around the globe for more than 60 years. Its unique multiple-portfolio manager approach, The Capital SystemSM, sets it apart from many other global asset managers. Rob Lovelace – who is

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Markets rally on strong data

Markets rally on strong data

🕔11:38, 12.Apr 2021

Strong economic data over the last week in the US, Europe and Asia appears to be confirming the perception among investors that a cyclical recovery is well established. As a result, valuations of risk assets have risen on the view that the pandemic will be overcome this year.

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Barometer: Laat de rally doorgaan

Barometer: Laat de rally doorgaan

🕔11:15, 12.Apr 2021

Barometer: Laat de rally doorgaan  April 2021 Ruime monetaire en fiscale stimulansen zouden de economie en de bedrijfswinsten een sterke duw in de rug moeten geven. Daarom blijven we de voorkeur geven aan cyclische aandelen. De wereldeconomie kent een sterke

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Investors’ Outlook The global economy heats up and stokes inflation fears

Investors’ Outlook The global economy heats up and stokes inflation fears

🕔08:16, 12.Apr 2021

Just when we thought we could stop hunkering down in our interconnected yet improvised offices (sometimes carved out from a children’s bedroom), a third pandemic wave has come upon us. Moreover, inflation worries have suddenly emerged.

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China: Transitioning To A Brave New World

China: Transitioning To A Brave New World

🕔16:04, 9.Apr 2021

The return of volatility to China markets. China’s equity markets have been roiled by a combination of concerns in recent weeks, culminating in the fallout from the Archegos family office liquidations in late March. However, this volatility has retraced …

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Diversifying Credit Portfolios With Multi-Factor Strategies

Diversifying Credit Portfolios With Multi-Factor Strategies

🕔15:15, 9.Apr 2021

The past decade has seen the use of multi-factor investing in corporate bonds increase significantly. Easier access to corporate bond data along and a growing body of research has enabled managers to develop robust factor-based …

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Top-Down Portfolio Implications of Climate Change

Top-Down Portfolio Implications of Climate Change

🕔14:06, 9.Apr 2021

Environmental changes throughout the remainder of the 21st century will undoubtedly influence economic trends. Both physical and transition climate change risks have potential consequences for long-term investors. However, precise estimates of these risks are not available. To assess the top-down,

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STOXX Monthly Index News

STOXX Monthly Index News

🕔12:59, 9.Apr 2021

Stocks extended gains in March as countries pushed ahead with their COVID-19 vaccine rollouts, the US passed a new stimulus package and major central banks indicated they are likely to keep interest rates low even as the economy rebounds. The

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Is factor investing still relevant today?

Is factor investing still relevant today?

🕔10:03, 9.Apr 2021

In 50 years of factor investing, there have been a series of love/hate phases with regard to the use of factors in selecting stocks for portfolios. At present, 2019-2020 seems likely to go down in history as a period of aversion, much like 2009-2011 and 1998-2000. These are the periods when most of the conventional factor combinations used by portfolio managers did not perform.

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How to Turn Value at Risk into Value from Risk

How to Turn Value at Risk into Value from Risk

🕔08:19, 9.Apr 2021

In this research piece, we demonstrate the value of the Axioma Worldwide Equity Linked Factor Risk Model (WWLM4-MH or ‘Global Linked Model’) for solving two very common analytical problems when managing global portfolios. Global equity mandates are often broken into

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EM: deze keer is het anders

EM: deze keer is het anders

🕔15:47, 8.Apr 2021

Als we dieper ingaan op vastrentende waarden uit opkomende markten ontdekken we variatie in spreiding, zowel over landen als over kapitaalstructuur.

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The Role of Cryptocurrencies in Investor Portfolios

The Role of Cryptocurrencies in Investor Portfolios

🕔14:37, 8.Apr 2021

The role of cryptocurrencies as a vehicle for speculation has been well established. However, it is less clear if cryptocurrencies can also serve to manage risk. The authors seek to determine the diversification potential of cryptocurrencies both for short and

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Diversify your allocation to corporate bonds with multi-factor investing

Diversify your allocation to corporate bonds with multi-factor investing

🕔13:02, 8.Apr 2021

Over the past decade, multi-factor investing in corporate bonds has seen significant development. Easier access to better datasets along with an extensive body of research has enabled managers to move the dial significantly. Investors can now access robust factor-based strategies offering diversification benefits in corporate debt allocations.

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Tesla’s governance is stuck in reverse

Tesla’s governance is stuck in reverse

🕔09:51, 8.Apr 2021

We have sold Tesla from our Global Sustainable Equity portfolios, having held the shares since early 2019. This sale follows a downgrade in our internal sustainability ranking.

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Shelter from the Storm

Shelter from the Storm

🕔16:45, 7.Apr 2021

The current backdrop poses the question, what are the best defensive strategies for a fixed income investor to pursue in a reflationary environment? As Figure 1 shows, a meaningful bond sell-off during a phase of quantitative easing (QE) is not unusual, largely because QE is ….

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Herstel zet door in maart

Herstel zet door in maart

🕔14:02, 7.Apr 2021

In deze dekkingsgraadscan vindt u meer informatie over de dekkingsgraad van een gemiddeld Nederlands pensioenfonds. We geven een overzicht van de ontwikkeling van de feitelijke en (12-maands) voortschrijdend gemiddelde dekkingsgraad in …

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Slimme datacenters: een revolutie in groen vastgoed

Slimme datacenters: een revolutie in groen vastgoed

🕔12:05, 7.Apr 2021

De uitbreiding van de digitale economie doet de vraag naar datacenters toenemen, maar baart ook zorgen over hun energieverbruik. De oplossing voor dit probleem is een aantrekkelijke belegging in groen vastgoed. 

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Asian equities inspire confidence, even after volatile quarter

Asian equities inspire confidence, even after volatile quarter

🕔10:53, 7.Apr 2021

Asian equities peaked twice in the first quarter amid optimism over the recovery in China, the prospect of improved relations between the new US administration and China, and the arrival of COVID-19 vaccines. Zhikai Chen, head of Asian equities, argues the outlook for much of the region remains positive, even after a valuation-related stumble.

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2021 predictions for private markets

2021 predictions for private markets

🕔09:04, 7.Apr 2021

Last March many would have thought that with at least three major pharmas rolling out their vaccines, nine months later the crisis would be winding down. Unfortunately, a combination of underestimated virus contagion and overestimated vaccine distribution makes it look like 2021, at least through the first half, will be a continuation of 2020.

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The Duration of Value and Growth

The Duration of Value and Growth

🕔16:13, 6.Apr 2021

Over the last few weeks, we have seen a rise in bond yields alongside an outperformance in global value stocks relative to growth stocks. While we at GMO have certainly been happy to see some recovery in value stocks (and we are confident that this recovery has much further to run), the moves have only reinforced a narrative that has been gaining ground in …

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The Bank of Japan – keeping a lid on volatility

The Bank of Japan – keeping a lid on volatility

🕔14:37, 6.Apr 2021

In its meeting last week, the Bank of Japan (BoJ) announced several changes in its monetary policy framework, but also confirmed its policy to keep yields under control. While other government bond markets have seen quite some volatility in the …

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The post-COVID-19 world, with Capital Group’s Night Watch

The post-COVID-19 world, with Capital Group’s Night Watch

🕔12:05, 6.Apr 2021

Rembrandt’s masterpiece “The Night Watch” is the inspiration for a multidisciplinary research process at Capital Group. Everyone in the painting is looking in a different direction and it is this gathering of multiple perspectives that summarises our approach to gaining a deeper understanding of market disruptions, assessing the risks and evaluating the opportunities that arise during times of extreme crisis.

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Reflation trade on hold

Reflation trade on hold

🕔10:52, 6.Apr 2021

Valuations of risk assets have marked a pause in the face of a number of headwinds. In our view, valuations remain underpinned by ample central bank liquidity and the prospect, in the US, of further fiscal stimulus.

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Facial Recognition and Human Rights: Investor Guidance

Facial Recognition and Human Rights: Investor Guidance

🕔10:38, 6.Apr 2021

Technology has brought the world some wonderful benefits – and some wonderful investments. Technology has allowed many professional workers to continue their jobs from their homes during the current pandemic. President Biden conducted a significant portion of his election campaign from his basement. Yet we must be aware in any new technology that unintended consequences can arise.

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Podcast: Strong fundamentals underpin Asian equities

Podcast: Strong fundamentals underpin Asian equities

🕔13:43, 2.Apr 2021

Asian equities rode high early in the year amid optimism over the recovery in China, the new US administration and improved relations with China, and the advent of vaccines. The outlook for investor flows into much of the region remains positive, even after a recent valuation-related setback. Zhikai Chen, head of Asian equities, discusses the prospects for the asset class this year.

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Why the Eurozone Will Not Mirror China’s Post‑COVID Recovery

Why the Eurozone Will Not Mirror China’s Post‑COVID Recovery

🕔09:56, 2.Apr 2021

China’s success in quickly getting its economy back on track in the wake of the coronavirus will be studied closely by other regions hoping to achieve the same. The eurozone in particular, which faces the possibility of extended lockdowns as the European Union (EU) struggles with its …

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The great rate debate

The great rate debate

🕔08:57, 2.Apr 2021

President Joe Biden signed the $1.9tn American Recovery Plan into law this month, adding to the $0.9tn stimulus in late 2020. Debate is turning to the next bill on longer-term infrastructure, clean infrastructure and inequality measures …

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How vaccines are paving the way for the ‘grand reopening’

How vaccines are paving the way for the ‘grand reopening’

🕔16:55, 1.Apr 2021

6.45pm, 15 March 2021 – this is my appointment for a first dose of the Covid vaccine. I don’t want to give away my age, but by then approaching 25 million people will have received their first vaccine dose in the UK – close to half the adult population. I don’t know which vaccine I will get, but either way we are on our way. The grand reopening is coming.

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The Decisive Eye

The Decisive Eye

🕔14:07, 1.Apr 2021

COVID-19 will leave an indelible scar on people and businesses which will take time to heal. While optimism mounts as global vaccination gets underway and spring shoots of recovery break through, the ever-present challenges that loom large on the …

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Fasten Your Seatbelt for More Interest Rate Volatility

Fasten Your Seatbelt for More Interest Rate Volatility

🕔12:13, 1.Apr 2021

Rising global bond yields and interest rate volatility have been dominant themes in fixed income markets so far this year. In our latest investment team meetings, we discussed how likely these trends are to continue—and the potential implications for bond markets and central bank policies if they do.

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Asset bubbles and where to find them

Asset bubbles and where to find them

🕔10:47, 1.Apr 2021

There’s only one sure way to identify an asset bubble, and that’s after the bubble has burst. Until then, a fast-appreciating asset may seem overvalued, only for its price to keep rising. Anyone who has tried to breathe one last breath into a balloon and finds it can accommodate …

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The blue economy in numbers

The blue economy in numbers

🕔10:39, 1.Apr 2021

Growth, employment, consumption, renewable energy…These are all indicators that reflect the rapid rise of the ‘blue economy’ and its growing contribution to business and industry, better living standards and the development of a more responsible global economy.

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Going beyond “active vs. passive” in EM debt

Going beyond “active vs. passive” in EM debt

🕔12:59, 31.Mar 2021

These are promising times for emerging markets (EM) debt, as we see a number of macro factors aligning in a broad tail wind for the sector. EM economic growth is leading the global recovery, yet EM is the only major sector with broadly attractive valuations. In developed markets, while rates have backed up from their extreme lows at the start of the year, monetary policies continue to anchor core …

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It’s my party and I’ll wait until I want to..

It’s my party and I’ll wait until I want to..

🕔11:45, 31.Mar 2021

Core government bond yields were lower and curves were flatter after a volatile week which, at one point, saw US and Europe diverge with US treasuries bear steepening while European government bonds experienced a bull flattening on Wednesday. Markets were caught between inflation concerns …

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Value stocks – Different definitions can mean significantly different outcomes

Value stocks – Different definitions can mean significantly different outcomes

🕔11:37, 31.Mar 2021

There is no universal approach to identifying value stocks or measuring their performance. Using various measures of a company’s fundamental value and picking value stocks by comparing them to sector peers would have boosted investment performance over the last decade. However, this style would still have lagged as value stocks kept getting cheaper and expensive stocks dearer.

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Seeking Alpha in Emerging Markets Corporate Debt

Seeking Alpha in Emerging Markets Corporate Debt

🕔10:37, 31.Mar 2021

Corporate debt is the fastest‑growing area of hard currency emerging markets (EM) debt, with almost USD 2.5 trillion outstanding and new issuance averaging 15% of debt outstanding per year since 2011. The asset class generated strong risk‑adjusted returns over the five years ended December 31, 2020, due to the …

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Podcast: Good Momentum for Value and ESG investing

Podcast: Good Momentum for Value and ESG investing

🕔09:19, 31.Mar 2021

A compelling investment opportunity: Japanese equities offer attractively priced and more visible earnings growth for 2021 and beyond. Nevertheless, Japanese equities are currently trading at a discount to global equities. And Japan equity markets have outpaced major developed market equities both in 2020 and year-to-date in 2021 as the world seeks to transition to a post-pandemic recovery.

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Crypto-currencies: a bubble or the emergence of a new paradigm in decentralised finance?

Crypto-currencies: a bubble or the emergence of a new paradigm in decentralised finance?

🕔08:55, 31.Mar 2021

The proliferation of crypto-currencies (CCs) and the popularity of these assets among investors has led us to question their nature, function, valuation and potential development. CCs are at the crossroads of technological innovation, finance and monetary policy.

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A Texas-Size Storm’s Global Implications for Plastics

A Texas-Size Storm’s Global Implications for Plastics

🕔16:04, 30.Mar 2021

When Covid-19 hit, many producers cut back production and drew down inventories as demand collapsed and the economic outlook was highly uncertain. While demand from cyclical end markets was hit hard, other end markets like …

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Exploring Techniques in MultiFactor Index Construction

Exploring Techniques in MultiFactor Index Construction

🕔14:07, 30.Mar 2021

The benefits of diversifying across a multitude of smart beta equity factors have been supported and explained in a host of research and literature1 . Single-factor indices (quality, value, momentum, low volatility, and small size) may reward market participants over the long term, but can be notoriously difficult to time over the shorter term. Multi-factor indices, on …

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A pause in the rise

A pause in the rise

🕔12:54, 30.Mar 2021

The sell-off in US Treasury bonds reversed over the last week with the 10-year bond yield dropping from its intraday high of 1.75% on 18 March. The decline was driven principally by falling real yields as inflation expectations were mostly stable. There was also a reversal in the recent outperformance of value stocks relative to growth stocks.

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The Long Run Is Lying to You

The Long Run Is Lying to You

🕔10:17, 30.Mar 2021

Everyone knows the value strategy has been a grave disappointment out-of-sample since, say, 1990 (thirty years!). Even Fama and French know it. 2 And everyone knows the value strategy has been quite bad for the last 10+ years with the 2018–2020 period essentially a crash. Well, that’s all kind of true. But, as odd as this might sound, the realized …

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China’s Five-Year Plan: A transformative shift towards self-sufficiency

China’s Five-Year Plan: A transformative shift towards self-sufficiency

🕔08:27, 30.Mar 2021

The National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPCC) closed in Beijing on March 11th. This is the most important event on China’s political calendar, as the NPC approves the main policy objectives that will set the tone for the remainder of the year. This year was especially important, as it also …

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Capturing Asia’s secular growth opportunities: Q&A with Christopher Thomsen

Capturing Asia’s secular growth opportunities: Q&A with Christopher Thomsen

🕔16:32, 29.Mar 2021

Asia’s emergence as the world’s key engine of growth has been one of the most compelling investment stories in recent times. The newly launched Capital Group Asian Horizon Fund (LUX) (CGAH)1 is designed to tap into this attractive opportunity set and, in this Q&A, portfolio manager Christopher Thomsen explains why …

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Podcast: The technologies contributing to net zero

🕔13:52, 29.Mar 2021

Eliminating carbon dioxide emissions over the coming decades will require multi-billion dollar investments, as well as a wide range of efforts to reduce energy consumption, increase efficiency, electrify and decarbonise processes, and nurture alternative fuels to economic viability.

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What technologies do we need to get to net zero?

What technologies do we need to get to net zero?

🕔13:52, 29.Mar 2021

Meeting Paris Agreement climate change targets means tackling the harder-to-decarbonise areas of the economy with technologies that don’t yet exist at scale. There is no silver bullet to tackling climate change. It’s likely the answer to getting to net-zero emissions by mid-century is to deploy everything we have, but faster. 2050 is the target date for net zero that the Intergovernmental Panel on Climate Change (IPCC) says[1] is what’s needed …

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Big Market Delusion: Electric Vehicles

Big Market Delusion: Electric Vehicles

🕔12:22, 29.Mar 2021

Big markets have a special allure for investors. They offer the promise of another Apple, Google, or Microsoft. But big markets also bring with them the threat of what Cornell and Damodaran (2020) call “the big market delusion.” Big market delusions generally begin with …

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