Asset Managers

The financial sector will suffer significant declines if the climate transition does not proceed in an orderly fashion. Abrupt climate risk revaluations will hit banks, asset managers and insurers particularly hard.

Losses in financial markets due to abrupt climate risk revaluations can hit investment funds and insurers hard. It can lead to defaults by companies and cause credit losses for banks. If we fail to ensure an orderly green transition, the risks will spread quickly throughout the financial sector, with companies and banks most at risk.

Pauline Grange (Columbia Threadneedle) emphasises the opportunities that currently exist in the market to take advantage of European efforts to improve energy autonomy in Europe. 

Forty years ago this week the bull market started in the United States. Not just any bull market, but the biggest bull market ever. Despite the crash of 1987, the dotcom graveyard, the attacks of 11 September 2001, the Great Financial Crisis and the Covid pandemic, this bull market continued to rise, fuelled by structurally falling interest rates, higher valuations and sharply rising profits.

The Dow Jones bottomed forty years ago on 12 August 1982 at 777 points, the same level as in January 1964. 

While defensive equity strategies have provided protection during previous downturns, this year’s results have been disappointing in some cases. In particular, strategies with a quality growth style have done considerably worse than the market. 

Europe’s energy supply is under severe pressure, and the 8.9% inflation rate in the eurozone seems to be cushioned only by sharp increases in interest rates, which could push the European economy into recession. Is Europe still the continent you want to be in as an investor?

Although the European economy had a relatively good second quarter, with economic volumes up 0.7% on the first, concerns for the second half of the year remain high.

With Europe and the US entering recession in the last half of this year, Asia, despite a series of severe lockdowns, is facing a brighter future, according to MainFirst portfolio manager Frank Schwarz, in an Investment Officer BE  interview, who adds that his favourite Asian investment theme is semiconductors.

Schwarz manages the newly launched MainFirst - Megatrends Asia fund. This equity fund focuses on Asian investment themes such as digitalisation, consumption, automation and decarbonisation.

Providers have been storming into the rapid growth of private equity as an asset class, reflected in the national and international growth of feeder funds and fund of funds. However, these product groups are associated with high pricing and common misalignments, according to Koen van Mierlo and Emile van Thiel of Bluemetric, in a recent interview with Investment Officer NL. 

After Thursday’s announcement of Apex Group’s acquisition of Sanne Group plc enabled the firm to position itself as a global, top-tier independence service provider, servicing nearly 3 trillion US dollars in assets, Investment Officer Luxembourg asked Renaud Oury, Apex’s Chief Revenue and Data Officer to speak about the significance of the deal, particularly for Luxembourg.

Concerns about rising inflation, monetary tightening, supply chain problems, Russia’s invasion of Ukraine and strict Covid measures curbing the Chinese economy dominated investor sentiment in the first half of 2022. The speed and intensity of the sell-off that hit fast-growing, highly-rated, and loss-making companies in particular was relentless.

Three things come into play when forecasting future inflation. First of all, the difference between supply and demand. At macro-economic level, an estimate is often made of the output gap, or the tightness of the labour market. In addition, the current inflation level also plays a role. Inflation is reasonably inert, well-anchored and responds slowly to changes. It takes time for a different inflation level to sink in with consumers and producers.