Emerging Markets - Evolving Strategies for Portfolio Implementation
Investing in Emerging Markets is hardly a new concept for investors across Europe; most investors now recognise the potential long term returns benefits of including emerging markets exposure within their portfolios. Although the story remains compelling, we believe there is a shift in dynamics tha
Investing in Emerging Markets is hardly a new concept for investors across Europe; most investors now recognise the potential long term returns benefits of including emerging markets exposure within their portfolios. Although the story remains compelling, we believe there is a shift in dynamics that could change the way we invest in emerging markets.
Emerging markets have "grown up", the larger emerging market companies have become more correlated to the rest of the world while many sovereign debt issuers have established enviable fiscal positions. It has also become more challenging to find active managers who have capacity along with a strong track record of out performance. For equity investors this has led to strong inflows into passive emerging markets strategies, a quest for a broader emerging market exposure, and a plethora of new passive approaches to accessing emerging markets. In fixed income the time is now ripe to bring indexing discipline to a maturing market.
We will share our insights on:
• Changing dynamics and governance needs in Emerging Markets
• Alternative approaches to Emerging Markets; news indices, access through developed market exposure
• Efficient implementation given the changing dynamics
• The growing suitability of index strategies to local currency Emerging Debt Markets
There are many things to consider when investing in Emerging Markets. Northern Trust’s experts will highlight the evolving opportunity set, ways in which to get exposure and some of the new alternatively weighted indices. Finally we will take a look at implementation strategies for getting efficient beta exposure to emerging markets.
Tom Walker, Portfolio Manager, shares his views on current market conditions and how the team are identifying companies that could prosper in a low growth environment.
•Oil prices – what the current level means and who the beneficiaries are
•Opportunities for global markets by sector and geography
•Identifying the winners and losers amid market volatility
•Update on the portfolio and recent activity
•Looking ahead for 2016
In this live and interactive webcast, Head of European Equities Paras Anand gives his views on the key drivers and implications of recent volatility in UK equities. With the sharp falls seemingly at odds with a slow and steady economic recovery, he will also outline the areas which could offer opportunities for investors over the coming months.
In volatile environments, maintaining investment conviction is paramount. Join Kurt Feuerman as he reviews 2015 and discusses his strategy for weathering the volatility that has thus far characterized 2016.
Although small in size, the IA Global Equity Income Sector has a diverse range of funds available to clients. Some take a more traditional approach of investing in ‘defensive’ mega caps, while others favour a higher beta more aggressive approach.
Hear from Fund Manager Kevin Troup, as he gives an overview of his Fund that offers something different. Having a style agnostic investment philosophy, coupled with diversified sources of income, gives the Standard Life Investments Global Equity Income Fund the ability to perform through the investment cycle.
Please join Bill Eigen, portfolio manager for the J.P. Morgan Income Opportunity Strategy for a review of the strategy over the prior month, current positioning and his outlook for the months ahead.
The JPMorgan Investment Funds - Income Opportunity Fund is an absolute return fixed income Fund, focusing on delivering the traditional characteristics of fixed income: Capital preservation, low correlation, and a reasonable risk adjusted return. It employs nontraditional techniques and instruments and draws on a variety of uncorrelated sources across the fixed income spectrum to aim for these characteristics even when the broad fixed income markets may struggle.
Don't miss this opportunity to hear from Bill and put forward your questions.
Featured Fund: JPMorgan Investment Funds - Income Opportunity Fund
If you prefer to listen over the telephone please use the appropriate dial in details from the numbers below.
A money laundering scam known as ‘Cuckoo Smurfing’ saw three men jailed for attempting to replace £700,000 of legitimate funds with ‘dirty money’. Business Resilience Manager, Graham Vance from the Scottish Business Resilience Centre presents. He discuss the case and how it highlights when a bank’s ‘adequate’ anti-money laundering procedures just aren’t good enough. And the importance of accountability and communication as part of the new FCA Senior Managers Regime.
Patrick Houweling, PhD, Executive Director and Jeroen van Zundert, Researcher at Robeco
There is extensive academic research that confirms the existence of factor premiums. Much of the conversation to date has been about factor investing in equity markets. Many of the explanations that apply to equities are also relevant to corporate bonds.
We invite you to join our webcast with Patrick Houweling and Jeroen van Zundert from Robeco who will share their research findings and insights into this approach to investing in credits.
Constructing your portfolio in a disciplined way to gain exposure to Low Risk, Value, Momentum and Size factors can help to achieve better risk-adjusted returns for your portfolio, with volatility similar to the index.
Pension funds seeking higher risk-adjusted returns at lower costs, wealth managers responding to regulation and asset managers increasingly have been asking – “how can we harvest alpha using factor indexes?”
In 2014, Brett Hammond, Managing Director and Head of Multi-Asset Class Applied Research, and fellow researchers from MSCI, co-authored an insightful paper demonstrating how up to 80% of alpha comes from exposure to factors. This paper won the index research industry’s prestigious William F Sharpe and Bernstein Fabozzi awards, and made a significant contribution to advancing the understanding of factors.
You are invited to join this webcast where Brett Hammond will discuss how multi-factor indexes can be used to harvest alpha. A range of approaches will be covered with a special focus on the MSCI Diversified Multi-Factor Index – a truly innovative, “all-weather” index that has demonstrated an ability (back tested) to deliver market-cap-index-beating, risk-adjusted returns.
The market is awash with factor-based investing methodologies and solutions - but are you really getting the factor exposure you desire in your portfolio?
While recent market volatility has brought attention to this issue investors should take a long-term view and develop a framework that is not overly influenced by short-term market noise.
From understanding individual factors and their performance cycles through selecting specific strategies, strategically implementing a factor based approach can be a daunting task. Furthermore given the disparity of returns from seemingly similar 'Smart Beta' strategies, the complexity increases dramatically.
Let us guide you through the white noise of factor investing and provide you with insights on a number factor based topics that we’ve recently investigated.
Brendan Maton, Dr. Ricardo Adrogué, Cem Karacadag, Natalia Krol
Join Babson's emerging markets fixed income portfolio managers to discuss how the macroeconomic environment is impacting the short-term and long-term trends driving emerging markets debt.
Dr. Ricardo Adrogué, Babson’s Head of Emerging Markets Debt, Cem Karacadag, Emerging Markets Sovereign Debt portfolio manager, and Natalia Krol, a credit analyst with the Emerging Markets Corporate team, will provide insights into their respective asset classes and discuss how Babson is seeking value in today’s markets.
Dr. Ricardo Adrogué is Head of Babson's Emerging Markets Debt Group. He is also lead portfolio manager for the firm's Emerging Markets Local Debt strategy, and co-portfolio manager for the firm's Emerging Markets Sovereign Hard Currency Debt, Blended Total Return Debt Strategy and Short Duration Bond Strategies. Ricardo holds a B.A. in Economics from the Universidad Católica Argentina, an M.A. in Economics and a Ph.D. from the University of California, Los Angeles.
Cem Karacadag is co-manager of Babson’s Emerging Markets Sovereign Debt strategy and backup manager for the firm’s Local Debt strategy. Cem has 20 years of industry experience that has encompassed sovereign credit analysis, macroeconomic policy research and advice, and emerging markets fixed income strategy. Cem holds a B.A. in Economics from Tufts University and an M.A. in International Economics and European Studies from Johns Hopkins University.
Natalia Krol is a credit analyst with Babson’s Emerging Markets Corporate team in London, focusing on CEEMEA and Asia corporates. Prior to joining the firm in 2014, Natalia spent 3 years at Schroders in London, covering resources and capital goods sectors across EM, high yield and investment grade. Between 2002-2010, Natalia was a European high yield analyst at Barclays Capital in London. Natalia holds a MSc in Accounting and Finance from London School of Economics and a BSs in International Economics from Plekhanov Russian Economic Academy.
Brendan Maton (IPE), Mike Hunstad, Meggan Friedman
Investors interested in reaping the benefits of factor-based investing in their portfolios have long believed the ultimate question to be, “Which factor should I choose?” Our most recent research shows, however, that investors would be better served to ask, “When should I favour each factor?” Our research also suggests that your investment horizon, rather than the timing of incorporating factor based strategies, is key to meeting your objectives.
As the global economy copes with the unpredictable challenges of climate change, institutional investors are exploring the potential impact of these changes on financial assets. With recent announcements by the Financial Stability Board in Basel and the Bank of England to examine the risks posed by ‘Stranded Assets’, more investors are calculating their exposure to high carbon assets and looking for ways to diversify into low or no carbon alternatives.
There are a growing number of options available to institutional investors. Some Asset Owners have announced plans to divest from high carbon assets, while others have looked to low carbon indexes which either exclude or reweight exposure to carbon-intensive companies while limiting short-term risk against the benchmark. We invite you to join a discussion with leading experts to examine the extent to which asset owners feel they are exposed to climate risk; the role of asset managers to encourage good practice when addressing climate change and carbon risk and how asset managers can effectively implement a low carbon strategy through index funds.
More and more investors are realising the advantages of factor investing and starting to implement its lessons not just as an afterthought, but as a top-down element of the overall investment strategy. A large percentage of pension funds still have a cover ratio that barely exceeds the minimum requirement and face funding issues due to the ageing demographics. To meet liabilities, pension funds are looking for higher returns while at the same time have less appetite for risk. Is factor investing the solution for the seemingly opposing challenges of risk and return?
The Power of Rebalancing: Fact, Fiction and Why it Matters
It is well-understood that rebalancing is a necessary step in restoring a portfolio of volatile assets back to its target weights. Whether it is performed periodically or triggered when actual weightings move too far from target, rebalancing a portfolio will naturally lead to selling assets that have outperformed the portfolio, and buying assets that have underperformed the portfolio.
It is much less widely understood that rebalancing can actually be a source of return for the portfolio. Despite the fact that this observation dates back to 1982 [Fernholz and Shay] and has been successfully used to manage portfolios for nearly as long, it has come under considerable attack in the recent past by some academics and practitioners. The main arguments used by these detractors are:
1. There is no return benefit, because the portfolio’s expected wealth does not increase.
2. The return benefit exists, but is due to diversification, not rebalancing.
3. The return benefit relies on mean-reversion.
These arguments may appear compelling at first glance, but all three are fundamentally flawed. This webcast will tell you why.
INTECH Investment Management LLC will act as sub-adviser to Janus Capital International Limited. Janus Capital International Limited (JCIL) is authorised and regulated in the UK by the Financial Conduct Authority.
Learn about investing globally in private credit
Insights into private credit fundamentals worldwide
Learn how private credit is originated
Key thoughts and considerations around portfolio construction and diversification in North America, Europe, Australia/New Zealand and developed Asia
Investors make portfolio allocation decisions for a wide array of reasons. For example, a pension plan may choose to implement a strategic asset allocation change as a result of an asset-liability study. Whatever the reason for the change in investment allocation, delay in implementation will invariably impact returns. Empirical evidence from State Street’s transition team shows that the delay between client investment decision and selection of a transition manager can run into several months and in extreme cases over a year. Current calculations of investment risk will tend to consider investment exposure relative to a benchmark once the portfolio restructuring is complete. Event Shortfall considers that investment risk starts at the point of decision. Measuring risk in this way implies that asset owners are running unrewarded and un-mandated risks for considerable periods of time and are often paying explicit fund management fees for the delivery.
Our webinar explains the background to Event Shortfall, considers some of the practical implications of measuring and managing these risks, and reflects on the viewpoint of industry figures.
- Weltweiter Trendmarkt Gesundheit: Die Nachfrage steigt überproportional
- Bis 2030 steigen Gesundheitsausgaben voraussichtlich rund +6% pro Jahr im Durchschnitt
- Relativ unabhängig von Konjunkturzyklen und unsicheren Börsenphasen
- Gesundheitsmarkt ist vielfältig: Nicht nur Pharma, sondern z.B. auch Generika, Biotechnologie, Betreuung/Pflege, Logistik/Vertrieb, Medizintechnik und IT.
- Zweistelliges Gewinnwachstum im Biotech-Sektor
· Fundamental and quantitative investment approaches are different, but complimentary.
· Blending fundamental and quantitative requires scale, research, and integration.
· A blended approach can lead to consistent performance in different market environments.
· Risk-aware portfolio construction can lead to high active-share while managing benchmark relative volatility.
As a Bank Loans investment expert, Mark Boyadjian, CFA, Senior Vice President and Director of Floating Rate Debt Group at Franklin Templeton Investments will discuss the Bank Loans asset class and the current U.S. bank loans market situation.
Mr. Boyadjian will provide insights on the following themes, and answer your questions during the live Q&A session.
Bank loans, a meaningful player in the broader fixed income space
Credit risk assessment when investing in Bank Loans
Tom Goodwin, Senior Research Director and Guillermo Cano Senior Product Manager, Russell Indexes
Introduction/description of topic
What? Factor-investing, or factor-based equity allocations, are entering the mainstream of the investment conversation. But investors are faced with ‘noise’ in the smart beta arena, including uncertainty around how smart beta can solve investment problems, and the differences between ‘smart beta’ and ‘factor’ indices that have exploded onto the scene. So where do they begin?
Why? If investors have a desire to tilt portfolios towards strategies that can potentially both tolerate market volatility and generate long-term positive returns, exploring how factor-based equity allocations can help achieve these investment objectives is a good place to start.
How? Practical implementation of exposures to these factors raises a new set of questions such as how to efficiently capture the desired factor exposure(s) while being mindful of turnover and capacity, and how to maintain a well-diversified portfolio.
This Russell Indexes’ webcast seeks to guide investors through these complexities. We will illustrate how we’ve cut through the noise to focus on what our research has shown to be the most important and complementary factors for portfolio construction: low volatility, value, quality and momentum. We will also provide examples of how factor combination portfolios can align with investor beliefs, preferences, and constraints.
How do you combine various risk factors to achieve greater risk-adjusted returns? We will explain:
1. How combining risk factors provides a diversification benefit
2. How to efficiently combine risk factors to ensure success
3. Multi-factor intersection portfolios -- And how they provide greater results compared to simple risk factor combinations
Register now to join our webcast to learn more about risk factor combinations and how Northern Trust Asset Management can help you navigate a better route to achieving your equity investment objectives, visit us today at northerntrust.com/equityimperative
There are valid reasons why this is the case. For starters, A‐shares are simply not on the “radar” of global investors, who rely on the policy benchmark to guide their allocation decisions. When a market is not represented in the benchmark, it is typically ignored. Thus, investing in A‐shares is often considered an “off‐benchmark” bet and tends to be opportunistic in nature.
In this webcast, MSCI will discuss the findings from their recent research paper “China A-Shares: Too Big to Ignore” and how investors can look beyond the current accessibility issues and should consider A-shares in light of the following:
· What are global investors truly missing when they avoid investing in A‐shares?
· What are some of “implicit costs” of not having A‐shares in a global equity portfolio?
· What is the potential role of A‐shares (if any) in global equity allocation?
Pension funds may have been granted a temporary exemption from the central clearing aspects of the European Market Infrastructure Regulation (EMIR) - an exemption that is likely to be extended - however, there are significant implications they need to start thinking about now. Asset protection is a key concern in a centrally cleared environment with the industry exploring various segregation models to increase asset safety and reduce counterparty risk. Coupled with the growing concern for liquidity availability EMIR is proving to be more challenging than initially thought. Let us guide you through these issues to help ensure you’re prepared and have the optimal solutions in place.
Contrary to conventional finance theory, research shows it is possible to generate higher risk-adjusted returns for investors with a low-volatility investment strategy. Many organizations offer solutions that seek to capture this return opportunity, but do so in ways that lead to high concentration in certain sectors, poor liquidity and high turnover costs. RAFI Low Volatility is a smart beta product built from the ground up to exploit the low volatility anomaly while preserving the benefits of passive investing.
Jamie Forbes, Scott Bennett, Brendan Maton (Moderator)
Integration of smart beta within portfolios to help control exposures
Global growth of smart beta among asset owners is set for a strong pace in the next 18 months. According to a recent survey conducted by Russell Investments of almost 200 equity decision makers at pension funds, asset owners are looking for products to address unmet needs, such as the ability to control or introduce specific exposures in their portfolios.
With the continued innovation in the smarter uses of beta, strategy indices designed to target specific factors such as low volatility, momentum and quality have been created to help address these needs. But the availability of product alone is not enough. Asset owners also need to consider how they integrate smart beta in their portfolios, either as a component to make their strategic asset allocation more efficient or as an extra tool to help them implement their strategy more effectively.
• Key findings from Russell’s recent survey of asset owners on smart beta adoption
• A proposed framework for incorporating smart beta allocations into an equity portfolio
• Case studies on implementation within pension fund portfolios
Vanessa Ritter, CFA, Head of Global Loans
Javier Peres Diaz, Lead Portfolio Manager, European Loans
Dennis Tian, CFA, Portfolio Manager, European Loans
Senior Secured Corporate Loans (otherwise known as bank loans or leveraged loans) provide access to a broad variety of issuers in a liquid market at an appealing yield. They can offer stable cash flows due to their floating-rate nature as well as their senior position in the capital structure. These characteristics can make them an attractive addition to any fixed income portfolio.
The webcast will cover:
•Key features of Senior Secured Corporate Loans – what are they, how do they work
•How big is the loan market and how does it compare with high yield bonds?
•What drives/impacts performance?
•Compelling reasons to invest in the corporate loan market
•Why BNP Paribas Investment Partners
This webcast channel is for pension funds and other institutional investment professionals in Europe, the USA and Asia. It is particularly relevant for pension fund executives, trustees, consultants and investment managers. IPE will be bringing its community live interviews with leading figures in the market, hosting roundtable discussions on specific topics such as asset allocation and also sharing latest thought-leadership from investment experts.