FIS Digital – December 2020

Is the present a predicator of the fut..

This session will take a deep dive into the macro economic outlook for next year, as well as the medium term and long term; including a discussion of the capital market assumptions that go into that outlook, and the impact on individual asset classes. Importantly it will also discuss asset class correlations and whether investors can rely on their current risk management and portfolio construction tools going forward.


Dan Farley is an executive vice president of State Street Global Advisors, and CIO of the investment solutions group. In this role, he oversees a team of over 75 investment professionals managing over $180 billion in multi-asset class portfolios, including tactical asset allocation, liability-driven investments and working with clients in developing customised investment portfolios to meet their specific objectives. He is also a member of the firm's executive management group. Prior to this role he was responsible for the US multi-asset class solutions team.
Farley holds an MBA from Bentley University, a BSBA from Stonehill College and has earned the Charter Financial Analyst (CFA) designation. He is a member of the CFA Institute and the Boston Securities Analyst Society. He is on the State Street Foundation's corporate allocations committee and executive sponsor of the firm's Latin American professionals group.. He is also the vice chair of the board at the Crispus Attucks Children's Center.

Millan Mulraine joined Ontario Teachers in 2016 after close to 10 years with TD Securities, most recently as deputy chief economist in New York where he was responsible for directing US economic research and rates strategy. At OTPP he leads the economics team and is responsible for designing and conducting macro-oriented research to inform the fund's investment decisions.
Mulraide holds an undergraduate degree in economics and statistics from the University of the West Indies in Jamaica, a Masters in Economics from the University of Warwick in England and a Ph.D. in Economics from the University of Toronto.

Bruno Serfaty has been head of the dynamic asset allocation team and senior portfolio manager in the multi-asset allocation team at USSIM since September 2015.
He has extensive experience in financial markets, manages a talented team of discretionary and quantitative traders and runs substantial assets across liquid asset markets within one of the largest tactical asset programs run from London. He has a long career in funds management including as a global macro trader, managing director and head of European fixed income working at Mercury Asset Management, Merrill Lynch Investment Managers, Dalton Strategic Partnership and Nylon Capital.


White is responsible for the content across all Conexus Financial’s institutional media and events. She is responsible for directing the bi-annual Fiduciary Investors Symposium which challenges global investors on investment best practice and aims to place the responsibilities of investors in wider societal, and political contexts, as well as promote the long-term stability of markets and sustainable retirement incomes. She is the editor of, the online news and analysis site for the world’s largest institutional investors. White has been an investment journalist for more than 20 years and has edited industry journals including Investment & Technology, Investor Weekly and MasterFunds Quarterly. She was previously editorial director of InvestorInfo and has worked as a freelance journalist for the Australian Financial Review, CFO, Asset and Asia Asset Management. She has a Bachelor of Economics from Sydney University and a Master of Arts in Journalism from the University of Technology, Sydney. She was previously a columnist for the Canadian publication, Corporate Knights, which is distributed by the Globe and Mail and The Washington Post. White is currently a fellow in the Finance Leaders Fellowship at the Aspen Institute. The two-year program consists of 22 fellows and seeks to develop the next generation of responsible, community-spirited leaders in the global finance industry.

Key takeaways


  • We have experienced a shutdown rather than a slowdown so need to navigate a path out of that space.
  • We look forward to thinking about a sustainable recovery.
  • There is a solid backdrop for risk assets due to low rates, risk-seeking investor sentiment and policy tailwinds causing the system to be awash with money. Gold is acting as a hedge against unexpected risk.
  • Most portfolios are not well equipped to deal with a rapid inflation shock, if it were to happen. A shock would place material pressure on valuations and equity markets, increasing the importance of hedging and thinking from a total portfolio perspective.
  • People are looking to real estate, commodities, gold episodically and infrastructure for returns but you must been highly selective since there is so much money chasing these asset classes.
  • The dollar has been a great tailwind for investors over the last few years but investors need to rethink those implications.
  • Bonds continue to be a diversifier, but the issue is that they are not as much of a diversifier as we want them to be so therefore we need to expand our defensive toolbox. Low volatility equities or hedges on growth equities growth are a possible alternative.
  • There are pockets of opportunity in 2021 including emerging markets Asia ex Japan, emerging market debt and the future of real estate.


  • There is a feeling that in 2020 and 2021 we are only papering over the cracks. What will the long-term cost be? Arguably all we have done is bring forward future growth, but where will sustainable growth come from in those future years?
  • The board is asking three important questions:

1) What is the performance expectation of assets?
2) What is the view on interest rates? And most importantly;
3) What is the view on inflation?

  • The inflation outlook is more uncertain than it has been over the last few decades. Natural hedges including diversification through geographies will help.
  • There is no easy answer to identifying an alternative to bonds for defensive purposes.
  • Geographically diverse investment in real assets provides positive opportunity in 2021 and beyond.


  • Our view is subdued. What will the long-term COVID legacy be? The scale of the policy response this time is unprecedented, which has caused immense debt load. GDP may more positively in 2021 and 2022, but the same cannot be the said for debt levels, quick the opposite in fact. There is a lot of money chasing good return in good investment and that is usually not a good recipe.
  • With bond yields so low, we should ask ourselves what is the purpose of a potential allocation to bonds. The answer to this question will help identify a potential alternative solution to achieve the same goal, including currency diversification.

Join the discussion