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Q3 outlook: Central bankers strike back
The more policymakers worry about inflation, the less investors need to. We’re willing to buy into further market weakness – and have done so in the past weeks. But we’re also likely to dial down our stance should the prospects of a recession grow.
Endgame portfolios: making the most of CDI
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 multi-asset diversification
Solutions Outlook 2022
In our 2022 Solutions Outlook, members of the team share their insights on what we believe to be some of the key themes for the year ahead. From CDI and credit markets to inflation, green gilts and equity protection strategies, we discuss some of the most important topics for DB pension schemes this year.
Climate Impact Pledge: Tackling the climate emergency
The second annual results of our Climate Impact Pledge showcase the corporate leaders and laggards on climate action; we are encouraged by improvements across sectors but will continue to press companies to meet this era-defining challenge.
The power of data science
Ros Altmann, former UK pensions minister, has spoken of the need to “make pensions digital”. The Department of Work and Pensions’ Pensions Dashboard aims to do just that, by collecting and curating information about members’ multiple defined benefit (DB) and defined contribution (DC) pension pots in a single, digital location.
Modern Monetary Theory: are deficit hawks an endangered species?
A once-fringe economic theory has been embraced by liberal politicians at the same time as traditional budget hawks have been in retreat. Its rise has potentially radical implications for inflation and investors.
Board effectiveness: Lessons from companies to trustees
Good governance is crucial to all boards, whether they oversee a FTSE 100 multinational, a multi-billion pound pension scheme or a national charity. There is no one-size-fits-all approach to how boards should be run but we have learned that there are plenty of ways to evolve and enhance effectiveness.
The prospects for and implications of a four-day working week
A future in which there is less work to be done will radically reshape the economy, with important consequences for investors – including some contrarian implications for the consumer and real-estate sectors.
Retirement anxiety, rate depression, populism…and what to do about it
With global interest rates remaining near all-time lows, and $15 trillion of debt providing investors a negative yield, bond-market bears are in danger of becoming extinct. But could today’s ageing society finally provide the trigger for a sustained bond-market selloff?
Emerging market debt – missing piece of the cashflow matching puzzle
Cashflow matching strategies are customised investment solutions, designed to enable clients such as pension schemes or insurance companies to meet their liabilities. We believe that emerging market fixed income has an important role to play in designing cashflow matching strategies.
Broadening the universe: The strategic case for alternative credit
The falls over the past two years in high yield and emerging market debt (‘alternative credit’) credit spreads,1 along with indications of late-cycle behaviour in the US, has led some investors to be nervous about allocating to these areas. But should pension schemes reconsider?
Responsible investing: factor friend or foe?
Can environmental, social and governance concerns (ESG) fit within a factor-based portfolio? In this article, we tackle two issues: the inconsistency in methodologies for ESG scoring, and ways to integrate ESG considerations into factor portfolios.
Q2 Outlook: Safety first
In our last quarterly outlook, we flagged our cautious posture on risk assets, taken due to a number of smouldering risks on the horizon. One risk we did not highlight, however, was that a pandemic would break out, causing untold human suffering and economic damage.
Active Voice: Turnaround stories
Companies that have seen their share price depreciate sharply in the face of self-inflicted wounds, structural challenges, or cyclical headwinds, represent potential ‘turnaround stories’. In this article we look at the attraction of investing in these businesses, and evaluate the risks or opportunities they present.
Walking a tightrope in 2018
We expect another strong year for growth with the global economy firing on almost all cylinders. But the market has priced in this optimism, implying greater vulnerability for disappointment. We expect the low interest rate environment to continue into 2018. While interest rates can drift up, we do not think this is the beginning of the end for the bond markets.
The future of TV: It's blurred
Predictions about the demise of the TV industry have persisted for over a decade, even as UK TV advertising and subscription revenues have continued to grow. However, we believe the industry has reached a tipping point, driven by rapid developments in technology and changing demographics.
Can better financial wellbeing lead to higher savings?
The DC pensions industry has moved forward since auto-enrolment was introduced, with many more saving into a pension. This is great news, but challenges remain. How do we help individuals see the value in saving more for a future that seems a long way off?
The value of any investment and any income taken from it is not guaranteed and can go down as well as up, and investors may get back less than the amount originally invested.