News & Research
Most Recent News & Research

Term spreads have risen in multiple regions around the globe, as long-term sovereign yields soared amid rising (expected and actual) inflation but central banks took longer to raise short-term interest rates. The impact of this on international real estate has mostly been positive over the past two-and-a-half years.

The market volatility and macroeconomic disruptions of 2022 have raised a challenge to the thematic investing boom, but also offer a chance to reappraise the benefits of the investment approach.

Amid rising inflation worries and expectations of additional interest rate hikes by the Federal Reserve, U.S. Treasuries have undergone a huge sell-off in recent weeks with no signs of reduced pressure ahead — but sources said there’s still an important place for the embattled bonds in institutional portfolios

Index | Thematic Investing
Thematic investing in the current climate – A more focused approach to sustainable and future-proof investing
The Russian invasion of Ukraine spooked equity investors around the world, but losses were not distributed equally across all sectors, with some industries even exhibiting positive returns. This opens up opportunities for more focused strategies such as thematic investing.

With inflation at multi-decade highs, a tightening of monetary policy appears inevitable. Since November, a growing number of central banks — most prominently the Bank of England — have begun to raise rates, and the Federal Reserve is expected to follow suit in March.

As 2021 draws to a close, the focus inevitably shifts to the year ahead. In terms of investment opportunities, we conclude that high yield bonds offer the most promising risk-return characteristics in 2022 for all examined scenarios.

Analytics | Portfolio Risk Management
Worried about rising inflation? Buying commodity currencies could soften the blow
Despite ongoing central-bank claims that the current spike in inflation is “transitory,” the recent surge in oil prices to 7-year highs, combined with ongoing supply shortages across many industries, suggests otherwise.

Analytics | Portfolio Construction
German Bund Yields Could Rise After the Election, But That May Not Be a Bad Thing
The votes from Germany’s federal election have been counted, but the result was far from decisive. We may be weeks, or even months, away from knowing who will succeed Angela Merkel as the next chancellor.

Analytics | Portfolio Risk Management
The Top 3 Drivers of the Stock-Bond Correlation (and, Yes, Inflation is One of Them)
In our latest whitepaper, Inflation and Its Impact on the Stock-Bond Correlation, we examined the historical interaction of equity and bond-market returns over the last 60 years to identify the main triggers of shifts in their relative directions—especially situations that might prompt the two asset classes to persistently move together. We identified three possible scenarios.

Analytics | Portfolio Risk Management
Inflation and Its Impact on the Stock-Bond Correlation: What history can teach us about their future relationship
In this paper, we examine the historical interaction of equity and bond-market returns—both in the recent past and over the last 70 years—in an effort to identify the main triggers of shifts in their relative directions.

Portfolio Risk Management
Inflation Will Likely Come Down, but It May Take Time for Markets to Benefit
Share prices continued to climb to record highs, despite another surge in US consumer prices. This may seem counterintuitive, but a comparison with the aftermath of the global financial crisis reveals that it may not be that unusual after all. At the same time, history also indicates that there could still be choppy times ahead—especially for the Energy, Materials, and Industrials sectors, which are likely to be adversely affected by falling prices for commodities and consumer goods.

Analytics | Portfolio Risk Management
Nervous About Rising Yields? Things Could Get Worse With No Cushion from Tightening Spreads
Credit risk premia have been at pre-crisis levels for a couple of months now, and so has predicted risk for corporate bond portfolios. Low spread volatility and the recent surge in sovereign yields means that risk-free interest rates have once more become the dominant return driver for investment-grade securities.