Equities

Hedge Fund Update: First Quarter 2022

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Continuing the trend seen in second half 2021, global equity markets remained volatile during first quarter 2022, as global indexes declined. Despite the market drawdown, broader indexes mask the relative performance among index constituents. Underlying volatility across sectors was more pronounced. As a result, within long/short equity hedge fund strategies, manager returns had wide dispersion driven primarily by net exposure to growth names and recent IPOs within the technology, healthcare, and consumer sectors.

Emerging Markets Equities: It’s Not All About the Fed

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The Federal Reserve is poised to continue lifting interest rates this year. Many investors tend to view tightening Fed policy as a headwind for emerging markets (EM) equity performance and may be tempted to dial back exposure to the bloc, but market history is an inconsistent guide when gauging how EM equities will perform when the Fed raises rates. In this paper, we outline several reasons EM exposures could prove to be diversifying as the current cycle plays out.

Decades of Data: Emerging Markets 1987–2021

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The 2021 Emerging Markets edition of our annual report on the history of financial markets provides context for the range of returns investors can expect from equities, bonds, and cash; reveals the importance of various components of equity returns; examines the evidence for equity mean reversion; and reviews the relationship between initial valuations and subsequent returns for equities and bonds.

Decades of Data: Europe ex UK 1900–2021

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The 2021 Europe ex UK edition of our annual report on the history of financial markets provides context for the range of returns investors can expect from equities, bonds, and cash; reveals the importance of various components of equity returns; examines the evidence for equity mean reversion; and reviews the relationship between initial valuations and subsequent returns for equities and bonds.

2022 New Zealand Outlook: Balancing the Pivot

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New Zealand’s COVID-19 containment strategy served the economy well during the early days of the pandemic. However, New Zealand equities and bonds suffered in 2021 as growth slowed to a halt late in the year due to lockdown measures and inflation moved higher due to labour market constraints. Heading into 2022, New Zealand authorities have pivoted the strategy from zero–COVID-19 to minimisation and protection, while still embarking on a monetary policy tightening cycle. Balancing both strategies will be key to supporting New Zealand’s economic growth in 2022.

Keep Your Pencil Sharp on Your Active Value Exposures

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The prospect of higher interest rates has contributed to recent equity market volatility and provided a wake-up call for investors underweight some traditional value sectors. What may surprise some investors is that even managers that style themselves as value-oriented may be underweight bellwether value sectors. Now is a good time to sharpen your pencil on value manager exposures.

Decades of Data: United Kingdom 1900–2021

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The 2021 UK edition of our annual report on the history of financial markets provides context for the range of returns investors can expect from equities, bonds, and cash; reveals the importance of various components of equity returns; examines the evidence for equity mean reversion; and reviews the relationship between initial valuations and subsequent returns for equities and bonds.