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Given the disruption and chaos currently facing the world, society and economies, this session looks at what an imagined future would look like and what the role of finance could be in a more informed and sustainable world.[vc_quotes layout=”accordion” 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title=”Moderator” el_class=””][vc_empty_space height=”10px”]
Key takeaways
Stewart
The future is about risk allocation, not asset allocation. COVID-19 makes the distinction clearer between mature and less mature economies.
In the future we should approach benchmarks with caution as they will look very different.
Supply chains will be more spread across countries to reduce geographic concentration risk.
The future will see an acceleration of sustainability investing and a rising heat around the demand for social justice. Questions around mission and governance will arise with a greater resolve to implement greater horizon strategies.
A true long horizon portfolio may move away from 60/40 or 70/30 and move much closer to 100/0.
Angela
The future looks brighter if we invest in technological infrastructure such as broadband.
The future will see greater investment in the smaller cities.
Perhaps moving forward we will think very differently about investing in commodities or cryptocurrencies, or risk being left behind.
Geoff
Reassuringly, in the long-term the future growth trajectory will look a lot like the past; the combination of labour, capital and technology has been an incredibly resilient and consistent engine of growth and has survived World Wars and pandemics.
The Florida State Board of Administration has made some strategic moves to take advantage of opportunities in the dislocation, including in private equity, distressed debt and active listed equities.. But CIO, Ash Williams, is concerned about the underlying real economy.
The Responsible Asset Allocator Initiative finds that 25 leading public pension and sovereign wealth funds, with assets of $6 trillion, are investing tens of billions of dollars in COVID-19 solutions and in funds to support stricken companies. Here they look at what the leading asset allocators around the world are doing to respond to the pandemic.
Global economic activities will not be back to pre-COVID levels until 2022 according to CPP Investments’ outlook, with the giant Canadian investor expecting the situation to get worse before it gets better.
The coronavirus pandemic sparked a surge of volatility across global financial markets. In this paper, MSCI looks at five key lessons for investors from the crisis, including that managing factors was more critical than picking stocks.
New research looking at the impact of COVID-19 under different scenarios – from opening of economies to no vaccine – suggests the economic consequences of COVID-19 under all scenarios is substantial and the ongoing economic adjustment is far from over.
Meticulous planning for the next market crash, and an eye on liquidity, meant IMCO was well positioned to invest, particularly in credit, when the opportunity arose. The fund continues to use its agility to its advantage and is now looking for opportunities in private markets.
It is critical to analyse how much COVID-19 could impact the US economy and stock markets but most of the traditional factors or economic indicators will lag the market movement. Therefore, alternative datasets other than the financial data show their explanation power to provide insights into the pandemic. This article, by academics at Tsinghua University, University of Illinois and Carnegie Mellon University, looks at the pattern of the market fluctuation from the perspective of alternative data.
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